Currently, India is Vietnam's largest trading partner in South Asia (Vietnam Investment Review, 2024), with the bilateral trade’s value reaching USD 14.70 billion registering an increase of 3.98% during 2022 – 2023 (Embassy of India, 2024). Thus, trade has played an important role in Vietnam - India's economic relations over recent years. One of the key items exported from India to Vietnam is frozen meat and fishery products, which belong to the list of duty-free goods according to the ASEAN-India Free Trade Agreement (AIFTA). According to APEDA ’s report 2022 - 2023, India is the fourth largest buffalo meat worldwide exporter with major export destinations (2022-23): Malaysia, Vietnam, Egypt, Indonesia, and Iraq (APEDA agriXchange, 2023). This proved the potential growth of the imported buffalo market for Vietnamese traders. However, importing buffalo meat is still risky and challenging, especially for startups that don't have much time to work on custom formalities. Therefore, understanding buffalo-importing procedure from India in detail is very necessary, ensuring international trade activities take place effectively. NHAT THANH DUC COMPANY LIMITED is currently one of the import startups in the Danang market, which was established in April 2022. The company focuses on importing frozen meats from foreign markets, such as India, Germany, Poland, etc, and then sells them to domestic businesses for various purposes. Especially, the highest contribution belongs to frozen buffalo from India, fluctuating the level of 50% annually. These values far exceeded the figures of the other types of meat, proving this market’s remarkable potential. That said, ensuring custom formalities in importing buffalo meats is important, which helps the company gain sales value and maintain a strong relationship with partners. In this report, the author will do an internship report titled “Analyzing the process for customs formalities in importing frozen buffalo meat from India at NHAT THANH DUC COMPANY LIMITED” while working as an Export-Import Intern at this office.
Rationale
In the context of strong international integration, highlighted by Vietnam's accession to the WTO and the recent signing of the TPP agreement, the country is experiencing significant economic development This has elevated the importance of import-export business activities within the market economy Recent statistics from the General Department of Statistics reveal that Vietnam's total import-export turnover reached an impressive 683 billion USD in 2023 The promotion of export activities has made the goods delivery process more efficient and essential, ensuring that foreign trade facilitates quick and effective delivery of products to consumers.
Vietnam's strategic location along the East Sea has led to the establishment of numerous ports, significantly boosting the sea freight forwarding industry Consequently, the volume and value of goods transported through these seaports dominate Vietnam's international trade While import activities play a crucial role in the economies of both Vietnam and Da Nang, they often face challenges that hinder efficiency and prolong processes To streamline these import procedures, forwarding companies like Danatrans Co Ltd serve as vital intermediaries, addressing various issues that arise during imports Acknowledging the significance of freight forwarding in facilitating imports, I chose to focus on the topic: "ANALYZING THE FORWARDING PROCESS IN IMPORTING FCL."
"SHIBATA-FENDER TEAM'S FENDER SYSTEM" USING CIF INCOTERM 2020."
Research objectives
An analysis of the forwarding process in the import operations of Danatrans Da Nang Company reveals both advantages and challenges Key benefits include streamlined logistics and enhanced efficiency in handling sea container shipments However, difficulties such as regulatory compliance, fluctuating shipping costs, and potential delays in customs clearance pose significant obstacles To improve the delivery of imported goods, it is crucial for the company to focus on optimizing its supply chain management, strengthening partnerships with reliable shipping providers, and investing in technology to track shipments effectively Addressing these issues will enhance operational performance and customer satisfaction in the long run.
Research subjects and scope
Place: Da Nang International Trading and Forwarding Co., Ltd, Da Nang, Vietnam
Research method
During my internship, I employed two primary methods of data collection: primary and secondary data Both forms of data were integral to conducting a comprehensive analysis on the chosen research topic
Primary data was collected directly from the field through observations of daily operations and staff tasks I conducted interviews that offered essential firsthand insights and data for the report To gather more detailed information on restricted areas of the company, I collaborated with colleagues who had access, enhancing our understanding of the company's current operations.
Secondary data was gathered from various existing resources, including the official Danatrans website and historical reports To enhance my theoretical understanding, I also examined relevant literature such as books, lectures, reference materials, and scholarly articles Data processing methods were applied to analyze this information effectively.
The financial data from Danatrans Company Limited, including revenue, expenses, and profits from 2019 to 2022, were collected and analyzed using statistical methods I also
During my internship, I integrated company documentation with direct observations, enabling the development of a comprehensive process diagram that illustrates the sea import process for full container load (FCL) cargo.
I conducted a comprehensive analysis of freight forwarding procedures to identify their strengths and weaknesses This evaluation allowed me to propose practical solutions and recommendations to improve the efficiency of the company's freight forwarding operations.
Topic’s structure
The research consists of 4 main chapters as follows:
Chapter 1: The theoretical basis of the process of freight forwarding Full Container Load (FCL) import shipment by sea
Chapter 2: An overview of Da Nang International Trading and Logistics Company Limited
Chapter 3: The current situation of the process of freight forwarding Full Container Load (FCL) import shipment by sea at Danatrans Co., Ltd
Chapter 4: Assessment and solutions to complete the process of freight forwarding Full Container Load (FCL) import shipment by sea at Danatrans Co., Ltd
THEORETICAL BASIS ON THE FORWARDING PROCESS IN
Freight forwarding
Freight forwarding, according to FIATA standards, includes various services related to the transportation, consolidation, storage, handling, packing, and distribution of goods through single or multimodal means This definition also encompasses ancillary and advisory services, addressing customs and fiscal issues, official goods declarations, insurance arrangements, and the management of payments or documentation related to the goods.
According to the Commercial Laws of 2005 in Vietnam, freight forwarding encompasses various commercial activities performed by traders, including the receipt, transportation, warehousing, customs clearance, and delivery of goods These services, which may also involve documentation handling, customer consultation, packaging, and labeling, are executed based on agreements with customers, who provide remuneration for the services rendered.
Freight forwarder
Freight forwarders play a crucial role in international trade, as defined by FIATA (2004), by ensuring the efficient transportation of goods from origin to destination while maintaining timely delivery, proper condition, and cost-effectiveness In the context of Vietnam, Article 234 of the Commercial Laws (2005) further outlines the responsibilities of freight forwarders in domestic transactions.
5 defines freight forwarders as enterprises that fulfill the legal requirements mandated for providing services as specified by the law
Freight forwarding is a crucial yet often overlooked component of the supply chain, providing essential services like customs clearance, international transportation, and pickup and delivery associated with global shipping (Ritvanen et al., 2011).
1.2.2 The roles of freight forwarder in the export-import operations
Advising the exporter on the most economical transportation options and optimal packing methods to minimize costs and prevent damage
A freight forwarder plays a crucial role in coordinating air, ocean, and land transportation, including intermodal cargo movement They manage the entire logistics process, ensuring the proper packing, labeling, and adherence to documentation requirements for smooth clearance at the destination port Additionally, when dealing with letters of credit, the forwarder guarantees strict compliance to assist exporters in securing payment.
Freight forwarders offer significant value beyond just transportation, as they aid shippers and consignees in tracking and tracing cargo By utilizing their purchasing power to secure space on airlines or ships at wholesale rates, they can negotiate better pricing with carriers, ultimately benefiting their clients.
A freight forwarder provides a comprehensive range of services that enhance material, information, and cash flow in logistics Material flow includes not only the transportation of goods but also essential activities like consolidation, quality control, sorting, return logistics, packing, project logistics, and warehousing The information flow ensures effective data exchange among all parties involved in the transportation process, including offices in the origin country and customs, often featuring services like shipment reporting and electronic tracking Additionally, cash flow management may involve handling insurance payments and customs-related transactions, ensuring smooth operations throughout the shipping process.
6 customs duty and VAT on behalf of the buyer, particularly when the buyer lacks a direct contract with customs (Ritvanen et al., 2011).
Importing FCL by sea
FCL, or Full Container Load, is a shipping service where a single container is exclusively used by one shipper, making it a cost-effective option for businesses with enough cargo to fill an entire container (Essilfie-Baiden, 2020) This method is generally cheaper than LCL, or Less than Container Load, on a per-unit basis, as freight agents prefer to transport full containers rather than consolidating goods from multiple clients For businesses dealing with large quantities of products or raw materials, FCL often emerges as the most advantageous choice, despite potentially leading to higher inventory levels (Kronitz).
Full Container Load (FCL) refers to shipments where a single party owns all the cargo within a container, typically consisting of homogeneous items that completely fill the container.
The forwarding process of import FCL freight forwarding by sea
1.4.1 Process and criteria to evaluate the effectiveness of a process
Processes are essential for integrating systems, data, and resources within and between organizations, as highlighted by Dumas et al (2018) Any disruption in these processes can impede corporate operations, making them vital for organizational adaptability and compliance with evolving legislative demands Additionally, effective processes greatly influence an organization’s revenue potential and cost structure.
1.4.1.2 Criteria to evaluate the process of sea freight forwarding imported by FCL method
According to Dumas et al (2018), Fundamentals of Business Process Management, there are four basic criteria to evaluate the effectiveness of a process
Time is a vital metric for evaluating process efficiency, including both processing and waiting times This data is essential for predicting the completion time of ongoing processes and is valuable for effective process monitoring.
Cost measurement in processes focuses on allocating indirect costs to cases, which poses challenges compared to direct costs like component purchases While direct costs, such as car wheels, are straightforward, indirect costs—such as labor and machinery depreciation—require more complex methods for allocation Activity-Based Costing (ABC) was introduced to address these challenges by providing a more accurate way to assign indirect costs to products, services, and customers, considering shared resources ABC employs activities to effectively distribute indirect costs, including those related to a depot.
Evaluating product quality through execution logs can be challenging, but one effective method is to analyze the frequency of repetitions within these logs Such repetitions typically indicate task failures and are often found in sequences of tasks Additionally, customer satisfaction can serve as a quantifiable measure of product quality, providing further insight into the effectiveness of the production process.
Flexibility in a process pertains to its ability to handle changes or variations This can be gauged by examining the event logs generated by the process Occasionally, a process might
Excessive flexibility in business processes can hinder performance, as too many options may lead to inefficiencies By consolidating multiple instances of similar steps into a single log record, organizations can improve adaptability and streamline operations.
1.4.2 The process of sea freight forwarding of goods imported by FCL method
According to textbook of Insurance and International Transport (2008), FCL sea freight forwarding has basically 5 main steps as follows:
Receive and check the set of documents
After the contract is finalized, the customer provides a set of essential documents, including the sales contract, packing list, commercial invoice, bill of lading, and arrival information The documents officer carefully reviews these documents for any discrepancies and quickly reaches out to the customer for necessary corrections.
The shipping line issues an arrival notice that includes key details such as the Estimated Time of Departure (ETD), Estimated Time of Arrival (ETA), cargo weight, and associated fees like Destination Terminal Handling Charge (DTHC), Delivery Order (D/O) fee, and Container Imbalance Charge The forwarder then verifies this information, settles the necessary fees, and creates an arrival notice for the consignee.
The forwarding staff submits essential documents, including a company letter, original Bill of Lading, arrival notice, and container order, to the shipping company to obtain the Delivery Order (D/O) After paying the container lifting and lowering fees along with other charges, they receive an Equipment Interchange Receipt (EIR) slip Armed with the D/O, EIR, introduction letter, and container release order, the staff then heads to the port to collect the container.
The customs declarant submits documents (sales contract, packing list, invoice, bill of lading, certificate of origin) electronically through the VNACCS/VCIS system
Step 2: The system conducts declaration classification
Step 3: Pay taxes and prescribed fees
Step 4: Clearance of goods/ Release of goods/ Return of goods for storage
The forwarder issues the EIR slip, container list, and container loan certificate to the driver, who subsequently retrieves the goods from the port or Inland Container Depot (ICD).
Documentsations in the process of import FCL freight forwarding by sea
According to Vân Đ.T.H (2010), a sales contract is an agreement between parties that facilitates the exchange of goods In the context of international sales, this contract outlines the rights and responsibilities of buyers and sellers located in different countries The seller is responsible for providing the goods and transferring related documents and ownership rights, while the buyer must make payment and take possession of the goods.
A Bill of Lading (BL or OBL) is a crucial document that represents physical goods, establishing legal possession for the holder The ownership of the goods is tied to the possession of the Bill of Lading Various types of Bills of Lading exist today, and depending on the purchase agreement between the seller and buyer, alternative, less formal documents may also be utilized.
Receipt of cargo shipped on board
Agreement to deliver the cargo to the final destination
Agreement to release the cargo to the party who presents the original Bill of Lading
The holder of the original Bill of Lading possesses the rights to the shipped goods If the Bill of Lading is lost, it is essential to issue letters of indemnity and establish bank guarantees to protect the interests of the parties involved.
Parties on Bill of Lading according to (Hửrkkử et al 2010, 216.):
Carrier: the party responsible of arranging ocean transport
Shipper: usually seller, or factory who releases the goods for transport
Consignee: the named receiver of cargo
Bill of Lading in practice:
Shipping agency or ocean carrier will create Bill of Lading as 3 original documents and deliver them to shipper
The shipper will provide the buyer with the necessary documents once all payments have been completed in accordance with the agreed payment terms This delivery may be conducted through a bank if a Letter of Credit is utilized as the payment method, or alternatively, it can be sent via post or courier.
Buyers can obtain the Bill of Lading either by collecting it from the bank or receiving it through the mail To release the freight, buyers must deliver the original documents to the local agent of the shipping agency or ocean carrier in the destination country, as the release of freight is contingent upon the local agency possessing the originals.
According to Vân Đ.T.H (2010), a packing list is a crucial document that details all items contained within each packaging unit, such as cartons or containers, as well as the complete shipment This list is typically prepared by the manufacturer or exporter during the packaging of goods.
According to MSR Kumar (2019), a packing list is a comprehensive document created by the shipper that details the items included in a shipment, often featuring special identification marks as requested by the customer, such as “ABC XX” in blue letters This list is essential for insurance claims and tracking, as it clearly describes the contents of each package Additionally, the packing list should reference the customer's purchase order number and destination, and it is commonly affixed to palletized cargo for easy access.
A commercial invoice serves as a crucial bill from the seller to the buyer, detailing essential transaction information such as the description of goods, delivery and payment terms, and order date and number It is vital for overseas buyers to facilitate customs clearance, establish ownership, and organize payment Additionally, importing governments utilize commercial invoices to assess the value of goods for customs duty calculations.
Upon arrival, the carrier issues an arrival notice to the consignee (importer) or the freight forwarding company if the shipment was booked through a forwarder This notice includes essential information needed for customs clearance in the documentation section.
According to (Michelmann, 2010) Load, Seal & Ship, 1st Ed, D/O is a document from the owner or carrier of a cargo instructing release of the said cargo to another party A delivery
12 order is required when collecting empty and full containers from Container Yard (CY) and Container Terminal (CT)
Carriers provide a Delivery Order to the Container Terminal, indicating that a container is authorized for release to the consignee This release process typically coincides with customs approving the import declaration.
A certificate of origin is essential for specific countries to assess a product's eligibility for preferential duty treatment This document verifies the origin of the exported product and is typically issued by local chambers of commerce (Beley, 2000).
A customs declaration is a legal process where an individual indicates their intention to subject goods to a specific customs procedure, as defined by the Union Customs Code (UCC) in Articles 5 (12) and 158 to 187 According to Article 6 of the UCC, these declarations must be submitted electronically.
AN OVERVIEW OF Da Nang International Trading and Logistics Company Limited
General introduction
Name: DA NANG INTERNATIONAL TRADING AND LOGISTICS COMPANY
Headquarter: 39 Tran Quy Cap, Hai Chau district, Da nang city
Email: danatrans@dng.vnn.vn
The formation and development
On March 1, 1976, the Ministry of Transport issued a decision to establish Da Nang
Transport Agency Company, the origin of Danatrans International Forwarding Company
On June 20, 1976, the Minister of Transport signed Decision No 189/QD-GTVT regulating the tasks, powers and organizational structure of Da Nang Transport Agency Company
On June 13, 1995, the Ministry of Transport and the Ministry of Trade issued notice
No 3197/TB allowing the establishment of Da Nang International Trading and Forwarding Company Limited
On January 1, 1997, Da Nang International Trading and Forwarding Company Limited with the international transaction name Danatrans officially came into operation
2.2.2 The development of the company
Currently, the company operates 3 main types:
Logistics with forwarding and customs clearance services
Domestic and international transportation by sea, air
39 Tran Quy Cap, Hai Chau District, Da Nang City, Vietnam
Hoa Cam Industrial Park, Cam Le District, Da Nang, Vietnam
Danatrans Dung Quat Company Limited
Lot 10A, Km16, Binh Long, Binh Thuan Ward, Binh Son District, Dung Quat, Quang Ngai Province
Ho Chi Minh Branch: Danatrans HCM Joint Stock Company
No 06 Thich Minh Nguyet Street, Ward 2, Tan Binh District, Ho Chi Minh City Phone: 84 2172399
This branch located at the cargo terminal - Noi Bai International Airport, Soc Son District, Hanoi
Services provided
The company specializes in comprehensive logistics services, including air transport, consolidation, and storage of goods, beyond just port-to-port delivery of import and export items With an extensive network of agents, the company ensures high service quality to meet the growing demands of international clients Notably, the Ho Chi Minh branch, located just 700 meters from Tan Son Nhat Airport, is the busiest hub for handling export and import goods.
Danatrans has a short route from Da Nang to Laos’s through Lao Bao border gate and to Thailand through Mukdahan border gate quickly, safely and effectively
Before 2012, Cai Mep port in Ba Ria-Vung Tau was the primary gateway for imports and exports, causing significant challenges for companies and their customers However, the expansion of Tien Sa port in 2016 allowed larger vessels to access Da Nang, facilitating easier import and export processes for businesses in the central provinces This development led to reduced transportation costs, making logistics more affordable for companies and their clients.
We specialize in maritime shipping and serve as a forwarding agent for various carriers Our primary transport routes include Da Nang to Hai Phong, Da Nang to Ho Chi Minh City, and Da Nang to Quy Nhon, ensuring efficient delivery of goods by sea.
Danatrans operates a fleet exceeding 100 vehicles, catering to transportation needs along secondary routes Our container trucks and LCL cargo trucks traverse the nation, connecting
Da Nang to Ho Chi Minh City, Hai Phong, and various other provinces, establishing a comprehensive and efficient network for cargo transportation in both directions
Danatrans has built two bonded warehouses, each covering 5,000 m², designed to offer a spacious, dry, and flood-free environment free from hazardous materials These facilities feature an extensive fire protection system and are managed by a skilled professional team.
Located in Hoa Cam Industrial Park in Da Nang City’s Cam Le District, Danatrans's bonded warehouses offer a strategic advantage due to their close proximity to essential city destinations This advantageous location not only facilitates significant cost savings but also ensures timely delivery of goods, aligning with contractual commitments.
- Bonded warehouse - Da Nang train station : 5km
- Bonded warehouse - Da Nang International Airport : 5km
- Bonded warehouse - Da Nang City Center : 8km
- Bonded warehouse - Hoa Khanh Industrial Park : 8km
- Bonded warehouse - Tien Sa Port, Da Nang : 16km
Furthermore, Da Nang is the connection point between the North and South, so it is convenient to travel on the route from Danatrans's bonded warehouse to other provinces
With 15 years of business experience in the field of forwarding, Danatrans can well perform the role of customs clearance for customers, helping import and export activities to become easier for their customers
Organizational structure and company’s resources
Plan and research the company's operations Leadership, management and general administration of all business activities of Danatrans Company
Assign tasks to Deputy Directors and Department Heads in the Company to perform tasks according to functions
Support the Director in managing the Company's operations by effectively completing assigned tasks and motivating employees to perform their duties to the best of their abilities.
Document room Vehicles monitoring room
Accounting department includes: Head of accounting department; Deputy accounting department general accountant; Accounting liabilities; Bank accountant; Revenue and expenditure accounting; Accounting for branches; Accounting for logistics enterprises; Treasurer
Carry out professional financial and accounting tasks in accordance with state regulations on accounting standards and accounting principles
Develop annual and long-term financial plans
Manage and use capital effectively
Providing money for paying freight, paying advances to delivery staff to handle goods, at the same time collecting money, calculating salaries and calculating profits or losses from operations
Domestic and foreign debt management, tax reporting and tax payment
Effective management of delivery operations, including the import and export of goods at the port, customs clearance, and timely vehicle dispatch, is essential for seamless logistics The forwarding department plays a crucial role, supported by a dedicated Marketing team that identifies market demands and collaborates with other departments to enhance customer relations and broaden business activities.
The delivery department includes the following departments:
This department is divided into 2 parts: specialized in charge of exported goods and specialized in charge of imported goods
Where to store customer data and documentsary information
Coordinate with the accounting department when necessary operations arise
Carry out customs clearance procedures, open containers, deposit containers, store goods at the port
Monitor and report cargo container status
Arrange and coordinate support for sales departments to ensure service quality and accurate delivery time
Contact, arrange, and dispatch container trucks to carry appropriate quantities of goods, ensuring safety and saving transportation costs
Coordinate "smart" freight vehicles to save transportation costs and deliver on time according to the contract
Manage the number of vehicles in the warehouse and the number of vehicles in circulation
Manage and operate the warehouse system, perform receiving services, storage and distribution of goods according to complied orders
Control excess services such as provide forklift services, maintain the facilities or help to install special facilities
The Company's office is fully equipped with machinery and equipment for business activities such as computers, telephones, photocopiers, fax machines, printers
Danatrans has its own fleet of nearly 100 container trucks, cranes of 2.5 - 7 tons and small trucks for express transportation of 1.5 - 5 tons
Warehouse with an area of 30,000m² is spacious, equipped with electronic meters measuring the volume of shipments quickly and effectively
Our company prioritizes customer demands in warehousing and transportation by continuously introducing innovative services and expanding our operational areas to meet expectations This dedication enhances our credibility and reliability in the industry We provide comprehensive transportation solutions alongside complementary services, emphasizing exceptional after-sales support as a core value and a testament to our business ethics.
Our company boasts a highly skilled and dedicated team committed to their profession
We focus on talent development and recognition policies, highlighting the significant contributions and roles of each team member in driving the company's overall growth.
Table 2.1:Structure of the company by age
Table 2.2: Structure of the company by qualifications
Danatrans boasts a workforce of 31 employees, excluding 40 drivers and loaders, with nearly 19 holding college degrees or higher, enhancing the company's professional development The organization also benefits from experienced loading workers and drivers, contributing to operational efficiency The management team, composed of highly qualified professionals, prioritizes the training and support of new employees, fostering a collaborative environment All staff members are dedicated to supporting one another and are committed to upholding the company's interests, reputation, and image.
Business performance of the company
Danatrans Company has strategically established branches in major cities like Hanoi, Ho Chi Minh City, Da Nang, and Quang Ngai to enhance market growth and strengthen customer relationships Renowned for its expertise in freight forwarding, the company has built a solid reputation, resulting in a growing number of signed contracts Notably, around 40% of Danatrans' total revenue comes from domestic delivery activities, despite the contract values and profits being relatively modest.
The international market is a crucial revenue source for the Company, contributing 60% of total revenue from delivery activities With delivery operations established across numerous territories and regions globally, the Company continues to expand its international presence.
Southeast Asia mainly includes Laos, Thailand, Cambodia, and Singapore
Northeast Asia: China, Japan, Korea
Some countries in America and Europe
In addition, Danatrans Company also associates with forwarding agents in each region to facilitate import and export activities in the international market such as:
Navitrans, KL Express, DSV Air & Sea, AOM Logistics, Mekong Cargo companies operate mainly in Southeast Asia
Like logistics in some European and American nations
Danatrans serves a diverse clientele, including agents, factories, and accessory retailers Key customers include Hoa Tho Textile and Garment Company, Vinatex - Da Nang, DRC Rubber Company - Da Nang, Phu Bai Fiber Company in Hue, Hue Textile and Garment Company, Quang Ngai Sugar Company, and Binh Son Petrochemical Company.
Danatrans Company encounters competition from both local and international players in the logistics sector The Central and Central Highlands regions, rich in untapped potential, experience fragmented levels of imported and exported goods and services Domestically, Danatrans faces rivalry from several forwarding companies, including Vietrans, Vinatrans, Asiatrans, Saigonship, VOSA, and Vietlink, each with distinct operational scopes.
Table 2.3: Fields of operation of forwarding companies in Da Nang
8: Transporting oversized and overweight goods
11: Warehouse (regular warehouse, bonded warehouse)
The "x" mark is the field that the Company provides to customers
Danatrans offers a diverse range of services across multiple high-revenue sectors; however, it faces challenges as it does not operate as a shipping or brokerage agent, putting it at a competitive disadvantage compared to firms like Vinatrans, Saigonship, and VOSA, which have their own ships and agents, resulting in lower combined freight rates Despite this, Danatrans maintains a competitive edge through its empty container supply service and strong relationships with shipping lines Additionally, its extensive fleet enhances its express delivery service, allowing for efficient two-way transport across various ports and cities, enabling customers to select optimal transportation options at competitive prices This strategic advantage is effectively leveraged in Da Nang and nationwide.
Business performance results of the Company in the period 2020-2023
Table 2.4 Business performance during the period 2019 - 2022 at Danatrans
From 2019 to 2022, Danatrans Logistics Co., Ltd experienced significant growth in revenue, cost, and profit, as reported by its Business Department Established in 1997, the company leveraged strong customer relationships and an expanded business network to achieve a profit of 303,776,074 VND in 2019, despite the challenges posed by the COVID-19 pandemic and economic downturn This resilience highlights Danatrans' effective business strategies, which focus on meeting customer demands and enhancing organizational structure.
During the global upheaval caused by the COVID-19 pandemic, the company achieved significant revenue and profits despite disruptions in the global supply chain A key factor in this success was our substantial investment in technology and information systems, which allowed us to maintain a strong supply chain network By leveraging advanced digital platforms, we efficiently tracked and managed goods from origin to destination, resulting in a slight increase in orders during the pandemic in 2021.
CHAPTER 3 THE PROCESS OF FREIGHT FORWARDING FULL CONTAINER LOAD (FCL) IMPORT SHIPMENT BY SEA AT DANATRANS CO., LTD: AN EXAMPLE OF THE FORWARDING PROCESS OF IMPORTING FCL OF
"SHIBATA-FENDER TEAM'S FENDER SYSTEM"
Table 5.1: Diagram the forwarding process
(1) Company staff will receive customer requests and negotiate with the customer
1 • Receiving customer requests and negotiation
3 • Receive and check the set of document
4 • Delivery and receipt of goods
8 • Deliver the good and return empty containers
(3) The goods owner will deliver the goods receipt documents to Danatrans Company and the delivery staffs receive and check all of the relevant documents
(4) Delivery and receipt of goods Danatrans must gain delivery order (D/O) for further step
(5a) If the goods owner has completed customs clearance for the shipment, Danatrans's forwarding staff will proceed to step (6)
(5b) If the goods owner has not completed customs clearance for the shipment, the delivery staff will declare customs
(6) Danatrans’ staff borrows container from the shipping line
(7) Delivery staff carry out procedures for receiving goods at the port
(8) Danatrans’ driver delivers goods to the customer and returns the empty container and get container bet back
(10) Customer pay for the service provide by Danatrans as well as any extra fees and charges.
Description of the forwarding process
Most of the customer requests are through Danatrans’ e-mail address:
VIETRADE CO., LTD initiated contact with Danatrans via email at "danatrans@dng.vnn.vn." Following this, Ms Hua Thi Duong from the documents room will respond with a counter-offer letter, along with the necessary documentation, information, and quotation requirements for VIETRADE.
A shipping document typically includes essential details like the type and quantity of goods, departure and arrival ports, preferred carriers, estimated shipment time, expected arrival date, and contact information for the shipper This information is vital for accurately calculating delivery fees and determining the appropriate delivery vehicles.
Danatrans has been tasked by VIETRADE CO., LTD to facilitate the import of a shipment from SHIBATAFENDERTEAM SDN BHD in Malaysia to their warehouse located in Ho Chi Minh City, Vietnam The delivery team gathers essential information from VIETRADE CO., LTD to ensure a smooth transaction.
Exporter: SHIBATAFENDERTEAM SDN BHD LEVEL 11,TOP GLOVE
TOWER,LOT 11-H, NO.16,PERSIARAN SETIA DAGANG BANDAR SETIA ALAM,40170 SHAH ALAM, SELANGOR,MALAYSIA
Importer: VIETRADE CO., LTD 45 HOANG SA STREET, DAKAO WARD,
DISTRICT 1,HO CHI MINH,VIETNAM
Port of loading: PORT KLANG, MALAYSIA
Port of discharge: DA NANG TERMINAL ,VIETNAM
Good’s description: 4 X 40’HC CONTAINER STC: o TWENTY FOUR (24) PIECES OF SHIBATAFENDERTEAM FENDER SYSTEM: MODEL:SPC 1400(G2.4S) x 1x1 FENDER BODY HS CODE:
40169400 o Weight: 72000.00 kg o Product type: Rubber o Quantity: 24 packages
Shipping company: KES INDUSTRIES PTE, LTD
Estimated ship arrival date: December 21, 2023
Delivery address requested by the Goods Owner: VIETRADE CO., LTD 45 HOANG SA STREET, DAKAO WARD, DISTRICT 1, HO CHI MINH, VIETNAM
All necessary documents and information should be sent to Danatrans's email address, where Ms Duong will review them before proceeding to issue the sales contract.
3.2.2 Receiving customer requests and negotiation
Ms Duong bases on the information that sent by VIETRADE to issue an example contract
By this time there are two cases:
If the customer agrees with the policy in the contract, the process will continue to the next step to consult and receive customer’s information
If a customer disagrees with the contract policy, they can modify the example contract and return it to Ms Duong She will then forward the modified contract and all relevant documents to Mr Tran Nguyen Chau, the vice president of Danatrans, for further negotiation If email negotiations prove ineffective, Ms Duong will arrange a direct meeting between Mr Chau and the representative from the customer's company.
However, in this case VIETRADE is our old customer, they quickly agreed with the example contract sent by Ms Duong
3.2.3 Receive and check the set of documents
Upon delivery of goods to the loading port in Port Klang, CNC Shipping Line issues a bill of lading to the exporter, SHIBATAFENDERTEAM Subsequently, the exporter sends electronic notification emails to VIETRADE, including attached files related to the shipment.
Ship information and estimated arrival date (Appendix 1)
Once the documents are sent to VIETRADE, they are checked and forwarded to Danatrans Ms Duong receives these documents from VIETRADE and verifies their validity and accuracy for customs clearance She conducts a thorough verification process by comparing the information provided by the CNC shipping line, SHIBATA FENDER TEAM, and VIETRADE to ensure consistency and accuracy in the documentation.
Ms Duong compares the commercial invoice number and date of issue mentioned by VIETRADE with the corresponding details on the actual commercial invoice and the list of goods
Ms Duong carefully verifies that the bill of lading number listed on the list of goods matches the bill of lading number issued by the shipping company
Ms Duong cross-checks the declaration number on the export declaration with the declaration number on the export declaration list
Ms Duong meticulously reviews the export declaration list, ensuring that each product's import customs declaration number, value-added tax invoice number, and issue date align accurately with the details on the corresponding import declarations and product invoices.
Mr Duong dedicated about one working day to prepare the extensive paperwork, being the sole staff member in the document room responsible for this task After meticulously reviewing and verifying the documents, Ms Duong will forward them along with the relevant information to Mr Trang Vinh Tho, the head of the field.
31 room as well as vehicles monitoring room to gather more necessary paper and plan for the delivery of goods
3.2.4 Delivery and receipt of goods
Upon receiving the arrival notice from VIETRADE, Mr Tho will dispatch Mr Luu Tieu Vu and Mr Nguyen Van Dau to Tien Sa port to obtain the delivery order (D/O) after the ship's scheduled arrival To secure the D/O, Mr Vu and Mr Dau must present the required documents to the CNC shipping line representative in Danang.
One original Bill of Lading (B/L) (Appendix 3)
One introduction letter that has the name of Mr Vu and Mr Dau (Appendix 2)
Mr Vu and Mr Dau identification card
The Delivery Order (D/O) includes four copies necessary for the consignee to facilitate container release, extension, manifest reconciliation, and printing of container receipt forms This section will detail the documentation required to obtain the Delivery Order.
The letter of arrival is an essential document that allows Danatrans to declare customs in advance, saving valuable time for customers To ensure a smooth process, it is important to pay attention to the necessary information required for this procedure.
Send to: VIETRADE CO.,LTD
Address: 45 HOANG SA STREET,DAKAO WARD, DISTRICT 1,HOCHIMINH
Voyage no: 0HJ7WN1NC
Port of arrival: Da Nang Port
Bill of lading number: CNB0236968
Product name: SHIBATAFENDERTEAM FENDER SYSTEM: MODEL:SPC
Quantity: 24 pallets in 4 containers, NO: o CMAU8893692 o GCXU5827397 o SEKU6379066 o TLLU7783413
Upon receiving the arrival notice from CNC shipping line, Mr Tho informs Mr Ngan, a staff member in the vehicles monitoring room, about the quantity of goods and containers to be transported Mr Ngan then updates the whiteboard and the company system to identify available drivers who can transport the new order to Tien Sa port This process is crucial as it helps minimize costs associated with port entry and exit.
The director of VIETRADE Company has officially stamped and signed a document affirming the rights of Danatrans Company employees when engaging with Shipping Lines and Customs As stated in the letter (Appendix 2), Mr Luu Tieu is the sole representative for these matters.
To mitigate the risk of losing important shipping documents and delays in shipment, Danatrans takes proactive measures by photographing the letter and sending it in advance to both the port guard and the CNC shipping line This ensures that the presentation of Danatrans' staff is acknowledged within a specified timeframe, facilitating smoother port access for Vu and Mr Nguyen Van Dau.
Assessment and solutions to complete the process of freight forwarding Full
Time
The implementation of VNACCS-ECUS5 and E-port has significantly enhanced efficiency and time management for Danatrans Company Custom declaration times have been reduced from 3-5 days to a maximum of just 6 hours, as noted by Mr Thang Additionally, the E-port system streamlines cargo reception at the port, saving valuable time In case of errors or missing documents during the application process, Danatrans receives prompt notifications from the Export-Import Management Department through the VNACCS system, eliminating the need for time-consuming trips to correct documentation issues.
Danatrans has built a strong rapport with the Export-Import Management Department, enhancing its expertise in customs clearance This collaboration has significantly streamlined the processes involved in working with the department Additionally, Danatrans maintains a positive relationship with the guard department at Danang port, further facilitating efficient operations.
46 help drastically reducing the time for field room staffs especially Mr Vu and Danatrans’ drivers
The need to physically submit documents after completing the online application can lead to delays in the custom clearance process, creating potential bottlenecks in workflow and increasing the risk of documentation delays Additionally, employees require time to adapt to the VNACCS system To enhance efficiency, Danatrans must upgrade its facility to address issues caused by a weak CPU that frequently causes the application to crash.
Ms Duong and Mr Thang at Danatrans Company manage customs declaration documents, often spending entire days preparing necessary paperwork The requirement for original documents, rather than copies, can lead to delays if materials do not arrive on time, ultimately affecting the customs clearance process's efficiency Additionally, the absence of an effective interdepartmental communication system exacerbates transfer times, as large files cannot be sent via Zalo, hindering overall operational productivity.
Cost
Strengths: Faster processing times lead to quicker import completion and potentially faster revenue generation
E-customs processing presents unique challenges compared to traditional customs clearance, as it necessitates the installation of specific software on company computers This requirement can lead to significant expenses associated with the traditional documentation process Additionally, the VNACCS system demands a stable internet connection, which can become costly, especially for companies operating with around 30 computers during peak times.
Quality
VNACCS presents the opportunity for enhanced transparency by enabling Mr Thang to track the status of his applications This feature allows him to stay informed about the
The E-port system enhances visibility and accountability in the submission process, providing Danatrans with a comprehensive overview of customs declarations This ensures a smooth experience for customers by facilitating quick cargo reception at the port Additionally, the system allows for real-time updates on the status of goods, informing customers about when their cargo will leave the port and its condition, whether good or bad.
The implementation of VNACCS and E-port systems has posed challenges for employees with limited computer skills, particularly older workers, leading to a significant decline in their efficiency Miscommunication between Mr Thang and field staff exacerbates the situation, especially during document submissions where discrepancies arise between papers prepared by the field and documents room Such mismatches often result in customs officers requiring Danatrans to redo paperwork Additionally, the poor quality of the website creates anxiety for new customers, further complicating their experience with Danatrans.
Flexibility
VNACCS offers significant advantages that enhance the efficiency of the customs clearance process Its key strength lies in its flexibility, allowing users to submit electronic applications from any location with internet access This capability enables individuals, such as Mr Thang, to initiate and complete customs declaration applications remotely, eliminating the need for a physical presence Additionally, employees like Mr Thang, who work in various departments, can contribute across different areas, ensuring that the company has sufficient human resources during critical processes.
While VNACCS has notable strengths, it also faces limitations, particularly regarding the necessity of submitting physical documents Although electronic submissions provide convenience and flexibility, the requirement to later submit physical documents to the Export-Import Management Department restricts this flexibility This issue is exemplified in Mr Thang's case.
Allocating time and resources for the physical delivery of documents can hinder efficiency in customs declaration preparation This requirement limits the flexibility of electronic submissions, as it demands strict adherence to specific timelines and procedures for document delivery.
Solutions to improve the process of freight forwarding Full Container Load (FCL)
Danatrans Co., Ltd has achieved significant milestones in the freight forwarding process for FCL import shipments by sea Nevertheless, to enhance its success and appeal to international customers, the company must adopt specific strategies and improvements.
4.2.1 Guarantee the confidentiality of information between departments
Effective communication and coordination between departments often rely on email and fax, but these methods can face limitations like network disruptions and misinterpretations To enhance collaboration, Danatrans should encourage face-to-face meetings among employees from different departments to finalize documents together Additionally, promoting informal communication tools such as Zalo and Messenger can improve the working environment beyond traditional email usage.
The advancement of technology brings challenges, particularly the risk of hacker attacks and fraud To combat this, companies should enhance their internal call security systems and consider recording calls for evidence By utilizing diverse communication methods, businesses can address shipping-related issues more accurately and efficiently, ultimately improving both security and operational effectiveness.
4.2.2 Upgrade and improve the quality of facilities
Development, upgrading, and innovation are crucial for Danatrans Co., Ltd to enhance efficiency and reduce errors through advanced equipment The company's outdated website needs an upgrade to better meet customer demands and maintain a competitive edge in the industry To ensure smooth operations, especially during peak hours, a stable network is essential for the VNACCS system An innovative solution proposed during my internship involves using the "Ultra View" app, allowing Mr Thang to remotely access the company's registered computer from his personal laptop after hours, facilitating efficient work during optimal internet conditions.
The analysis of the Full Container Load import shipping process at Danatrans Company Limited reveals critical insights into the complexities of import freight forwarding, essential for navigating the evolving landscape of global trade The company's dedicated workforce is enhancing administrative protocols and adopting technological advancements, which provide significant advantages for smaller logistics firms, including cost savings, improved time efficiency, and streamlined operations.
At Danatrans, having a strong professional foundation is crucial for employees to successfully manage the complexities of FCL import shipping by sea To meet client expectations effectively, it is essential to stay updated on the latest regulations and mandates from the Ministry and relevant authorities, as well as to understand the rules related to the goods being transported.
During my three-month internship at Danatrans Co., Ltd., I gained invaluable hands-on experience as a documentation officer, benefiting greatly from the support of my colleagues and the entire team This opportunity allowed me to enhance my skills and foster professional growth through various learning avenues.
My report includes evaluations and suggestions to reduce errors and ambiguity; however, it is important to note that some inaccuracies may arise due to my limited experience and the short length of my internship I look forward to receiving feedback from respected professors to improve and strengthen the report further.
(n.d.) Fundamentals of Business Process Management https://repository.dinus.ac.id/docs/ajar/Fundamentals_of_Business_Process_Management_1 pdf
(n.d.) Union Customs code - European Commission https://taxation-customs.ec.europa.eu/customs-4/union-customs-code_en
About Freight-Forwarding (n.d.) FIATA https://fiata.org/about-freight-forwarding/
Certificates of Origin - ICC (n.d.) International Chamber of Commerce https://iccwbo.org/business-solutions/certificates-of-origin/
Graves, S C (n.d.) (PDF) Tactical Shipping and Scheduling at Polaroid with Dual Lead-
Times ResearchGate https://www.researchgate.net/publication/37595373_Tactical_Shipping_and_Scheduling_at _Polaroid_with_Dual_Lead-Times
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Melin, K 2011 Ulkomaankaupan menettelyt Tampere: AMK-Kustannus Oy
MURPHY, P.R & POIST, R.F (2000) Third-party logistics: some user versus provider perspectives, Journal of Business Logistics, 21, (1), pp 121–133
Quản Trị Xuất Nhập Khẩu - Đoàn Thị Hồng Vân (n.d.) Academia.edu https://www.academia.edu/42186108/Qu%E1%BA%A3n_Tr%E1%BB%8B_Xu%E1%BA
%A5t_Nh%E1%BA%ADp_Kh%E1%BA%A9u_%C4%90o%C3%A0n_Th%E1%BB%8B_H%E1%BB%93ng_V%C3%A2n
The document titled "Export-Import Theory, Practices, and Procedures" serves as a comprehensive guide for understanding the intricacies of international trade According to estimates, the total import-export turnover for 2023 is projected to reach 683 billion USD, highlighting the significance of effective export-import strategies in today's global economy For more information, you can access the material at the Export-Import Library.
Quản trị xuất nhập khẩu là một lĩnh vực quan trọng trong kinh doanh toàn cầu, giúp các doanh nghiệp tối ưu hóa quy trình giao thương quốc tế Đoàn Thị Hồng Vân đã cung cấp những kiến thức cơ bản và chiến lược hiệu quả trong quản lý xuất nhập khẩu Bài viết trên Academia.edu phân tích các yếu tố ảnh hưởng đến hoạt động xuất nhập khẩu và đưa ra những giải pháp để nâng cao hiệu quả kinh doanh Việc nắm vững kiến thức về quản trị xuất nhập khẩu sẽ giúp doanh nghiệp phát triển bền vững trong môi trường cạnh tranh hiện nay.
Tài liệu XNK: Giáo trình tiếng Anh xuất nhập khẩu Export-Import Theory Practices and
Procedures (n.d.) thư viện xuất nhập khẩu https://thuvienxuatnhapkhau.com/tai- lieu-xnk-giao-trinh-tieng-anh-xuat-nhap-khau-export-import-theory-practices-and- procedures.html
Vietnam Logistics (n.d.) Alvarez & Marsal https://www.alvarezandmarsal.com/sites/default/files/2022-
The World Bank provides valuable data on Vietnam's imports, specifically through the indicator NE.IMP.GNFS.CD, accessible at their official website Additionally, the Vietnamese government's electronic portal offers essential documents, including a signed report from June 4, 2020, which can be found at the provided link.
Figure 8: Taxes has to pay