Non fixed day shipping schedule in tan cang shipping afects to customers satisfaction

Hai My Duong - January, 2018 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Hai My Duong (NON FIXED-DAY SHIPPING SCHEDULE IN TAN CANG SHIPPING AFFECTS TO CUSTOMERS SATISFACTION) MASTER OF BUSINESS ADMINISTRATION Ho Chi Minh City – Year 2018 Hai My Duong - January, 2018 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Hai My Duong (NON FIXED-DAY SHIPPING SCHEDULE IN TAN CANG SHIPPING AFFECTS TO CUSTOMERS SATISFACTION) MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: Trần Hà Minh Quân Ho Chi Minh City – Year 2018 Hai My Duong - January, 2018 Table of Content Executive Summary Background information Methodology Problem Identification Situation Analysis Symptoms Central problem 12 Initial cause-effected map 16 Potential root cause: 17 Cause-effected map: 21 Problem solving: .22 In short time: Providing a weekly fixed-day shipping schedule 22 In long time: Establishing the research and develop shipping schedule team .24 Action plan 25 Supported information 26 References 27 Appendix 01: Interviewees Information 28 Interview 1: Customers using TCS’s reefer service .28 Interview 2: Vice Director of TCS’s Customers .28 Appendix 02: Interview guides .29 Interview Guide 01: Customers using referred container service .29 Interview Guide 02: Regular customers 29 Appendix 4: Frequency of TCS’s shipping schedule 42 Appendix 5: Estimated output/ month for 40RH of TCS’s dry container customers .45 Hai My Duong - January, 2018 Professional terminology and abbreviation: No Professional terminology and abbreviation 20GP 40HQ 40RH TEU Depot Shipside Closing Time Freight Plugging Fee 10 OPS 12 TCS Hai My Duong - January, 2018 Executive Summary This thesis aims to identifiy the reason why TCS new reefer service could not attract customers Basing on in-dept interview in TCS’s current customers, market information and report from marketing department, thesis find out there are potential problems: - Low customer satisfaction of regular customers Competitors are stronger than TCS show on issues: Marketing strategy to attract new customers does not implement Using theories and analysis, identified central problem is: low customer satisfaction of regular customers To giving exactly problem solving, the thesis draws cause-effected map to find out root cause Thesis uses groups of factors affect to customers satisfaction to conduct an interview on regular customers, the result show that many customer unsatisfied with TCS’s shipping schedule, to change un-fixed day shipping schedule, the broad director should change their intension that having fixed-day shipping schedule is more important than full fill each trip Background information Tan Cang Shipping Joint Stock Company (or Tan Cang Shipping – TCS) is a transport service company, was established in 2013 under the decision of the Board of Director of Sai Gon New Port Corporation The beginning mission of Tan Cang Shipping is developing the transport services of Sai Gon New Port Corporation while their vision is "Leading in quality of service, customer oriented; Advanced management, professional and high quality in human resources; Military discipline, corporate culture, community responsibility " After almost years of operation, Tan Cang Shipping now works on three areas like Sea Transport Services, Logistics and Shipping Agent Despite its short time of operation, they work quite well, complete all the missions and develop Tan Cang Shipping becomes a prestige brand, having a strong position in the shipping industry in Vietnam nowadays With the criterion "Coming to Saigon New Port, coming to one of the top quality services", Tan Cang Shipping always tries to provide their customers best quality shipping service To the Sea Transport Service, Tan Cang Shipping provides customers with domestic transport services by sea line including main routes: Ho Chi Minh - Da Nang - Hai Phong and opposite or Ho Chi Minh - Hai Phong and opposite To Logistics, they provides a full range of professional logistics services such as freight forwarding, customs clearance services, warehousing services, And to Hai My Duong - January, 2018 Shipping Agent, we now are acting as an agent for vessels to import and export in domestic ports as well as international port in Vietnam In addition, we are ready to provide ancillary services such as customs clearance, fresh water supply, fuel, crewmembers supplying and other support services when the customer needs Besides developing shipping service, Tan Cang Shipping also focus on hiring and training their employees With the core value: "Satisfaction, Trust and Long-term commitment of our customers", all the employees of Tan Cang Shipping are always enthusiastic, hardworking, having responsibility with work and more experience to solve customers’ requirements quickly in all situations happened during transportation Moreover, Tan Cang Shipping usually has the policies of supporting and consultation so that they can make their customers feel satisfaction when they choosing their service and want to build a long-term stable cooperation The organizational structure of Tan Cang Shipping consists of departments: Hai My Duong - January, 2018 Methodology This thesis was developed and supported by both primary and secondary data with particular following methods and resources: Business reports: TCS's business performance report for dry service and reefer service in 2017 checked in order to analyze how TCS achieve the target revenue as well as how each trip follows the golden structure The report on reefer container’s revenue in 2017 be classified by customer’s name and trip Interview: From the results of data analysis in business report, classify the customer using TCS services into focus-groups, build an interview guide and in-depth interview for each group and TCS’s Vice Director Market Research: Online research in Viet Nam shipping line market as well as interview TCS’s customers to understand refer container market size Theory: Customer satisfaction and Service Quality in liner shipping industry Problem Identification Situation Analysis The domestic shipping market has types of good: dry container and reefer container Dry container included: 20GP (20feet) and 40HQ (40 feet) Reefer container in domestics market only has 45RH In liner shipping industry, the quality of good the vessel carried is calculated by TEU Each vessel has limited TEU to carried, all good have to be packaged in to container and 1x40HQ=1x45RH=2x20GP=2TEUS The domestic shipping is the core business of TCS TCS operates vessels with routes SouthNorth and opposite a week Domestic shipping industry in Viet Nam has liners: Hai An, TCS, Vinafco, Vietsun, Germadept, Bien Dong, GLS…TCS and Hai An are liners have more vessels and routes than the others From the beginning, TCS only transported dry container base on the relationship of broad Hai My Duong - January, 2018 director in the market to attract customers After years, TCS gain their trust and loyal, and the Broad of Director realized that reefer container market is a potential field to develop TCS has launched Reefer container’s service with objectives: Diversified TCS’s service: Most TCS customers are freight forwarders who have goods in both dry and reefer container TCS want to provide full of choice to customer who already has used TCS’s service in dry container filed Opportunity Costs: Receiving a reefer container is economically more cost-effective than a dry container of the same size Specifically, the empty dry containers are owned by TCS and incur costs repair, cleaning, stock in yard… while empty reefer containers are owned by the customer (domestic liner does not own empty reefer containers), so that customers will pay all of these fees Regarding the freight, reefer container cost 10 million VND while the dry one is million VND We can calculate the opportunity profit of transport a reefer container, TCS will gain million VND from difference freight while 40HQ and 40RH are covered similar slot (2 TUES), TCS will not pay the clean (200.000 VND) and storage fee (100.000 VND/ day) because 40RH are customer’s owner In order proceed reefer service, TCS's leaders were based on the actual situation of TCS customers, TCS infrastructure conditions and freight rates to calculate a golden structure for each ship to ensure the feasibility and maximize profit in the beginning At present, there are 20 customers using TCS’s dry service have reefer container need to transport (see Appendix 05, Source: Marketing Department Report, December, 2016) TCS expects to attract 20-30% of these qualities About the facilities of TCS, vessels of TCS have different capactity, Tan Cang Foundation (TCFD) – 370 TEUS, Tan Cang Victory (TCVR) – 325 TEUS, Tan Cang Pioneer (TCPN) – 395TEUS and Tan Cang Glory (TCGR) – 425 TEUS and different freight of 20GP (3 million VND), 40HQ (7 million VND), 40RH (10 million VND) TCS calculated the effective structure to ensure the feasibility, maritime safety and maximize profit called “golden structure” Hai My Duong - January, 2018 Table 2: Golden Structure of TCS’vessels Target Quantity TCFD TCVR TCPN TCGR Freight (VND) Symptoms After months operated reefer service, the result could not be as expected Show on: Under-expected quantity: For detail, basing on the revenue report from Jan to July, 2017, it is figured out that 95% of the transfer below the expected level, only 5% achieved as equal or more than expected 5% achieved the expected is on March, after Lunar New Year, when the market in in the peak But only 5/ 16 routes on March achieved, while the market is in the peak on March Chart 1: Revenue and target revenues by vessel in the beginning of 2017 For detailed analysis, for 20GP and 40HQ dry container, it is easy to see that dry sales nearly achieve the expected level, especially some trips are more remarkable Chart 2: Revenue and target revenues by Dry container in the beginning of 2017 Hai My Duong - January, 2018 Appendix 03: Transcript Interview 01: Customers using referred container service Questions Please tell me from where you know TCS's reefer container service and you decided to use TCS’s service in which situation? Why you decide to use reefer’s service at TCS? What is the pros of TCS reefer container’s service compared to competitors? (PROMT: tariffs, policies, services, support and customer service) Hai My Duong - January, 2018 What is the cons of TCS reefer container’s service compared to competitors? (PROMT: tariffs, policies, services, support and customer service) Can you please suggest how TCS will develop more reefer teus from the company? What is your average monthly reefer container tues and how you distribute your goods to the shipping lines? Hai My Duong - January, 2018 How would you evaluate your reefer container goods in the near future and you plan to distribute your company's structure on shipping filed again? How many lines of your company are using? Your current goods at TCS is not high, you intend to increase slot in the near future? Interview 02: Regular customers 33 Hai My Duong - January, 2018 Question PROMPT Reliability Do you feel that TCS provide reliable transportation service? • Consistency of customer service • Error-free documentation 34 Hai My Duong - January, 2018 • On-time pickup and delivery of cargo Speed Do you feel that TCS has faster transportation service than other liners? • Transit time of transportation service • Frequency of transportation service Hai My Duong - January, 2018 • Accuracy of cargo tracking systems • Idle time of shipments and availability of empty containers contribute to the speed of a Hai My Duong - January, 2018 shipment Responsiveness How you evaluate the performance of supporting activities when using TCS's reefer service? • Speed of claims Hai My Duong - January, 2018 • Effective of sale team • Promptness of customer service • Exhibition of socially responsible behavior 38 Hai My Duong - January, 2018 • Involvement in green shipping practices • Availability of large selection of service offerings Value Are you satisfied with all cost you have paid for TCS's reefer service? • The pricing of shipping service 39 Hai My Duong - January, 2018 • Total logistics cost When TCS’s schedule delay, we have paid the electronic fee in the pork, sometime, if we could not deliver goods on time, we will indemnify for the lately delivery • Condition of ships equipment It is good Safety and security of shipment I assurance about the safety 40 Hai My Duong - January, 2018 Which factors strongly affect to your decision when using reefer’s service in TCS? 41 Hai My Duong - January, 2018 Appendix 4: Frequency of TCS’s shipping schedule Week of 2017 02 Monday Saturday Sunday 03 Wednesday Sunday 07 Monday Tuesday Friday 08 Wednesday Saturday 09 Monday Tuesday Thursday Sunday 10 Friday Sunday 11 Friday Saturday Sunday 12 Tuesday Saturday Sunday 13 Tuesday Thursday Sunday 14 Tuesday Thursday 15 Monday Wednesday Hai My Duong - January, 2018 Sunday 16 Monday Friday 17 Thursday Saturday 18 Thursday Saturday Sunday 19 Monday Thursday Friday 20 Thursday Friday Saturday Sunday 21 Monday Thursday Saturday Sunday 22 Wednesday Friday Sunday 23 Wednesday Thursday Friday Sunday 24 Monday Wednesday Friday Sunday 25 Wednesday Friday Sunday 26 Hai My Duong - January, 2018 Wednesday Thursday Friday Sunday 27 Monday Wednesday Friday Sunday 28 Wednesday Friday Sunday 29 Wednesday Thursday Sunday Grand Total 44 Hai My Duong - January, 2018 Appendix 5: Estimated output/ month for 40RH of TCS’s dry container customers No 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 45 ... Monday Tuesday Friday 08 Wednesday Saturday 09 Monday Tuesday Thursday Sunday 10 Friday Sunday 11 Friday Saturday Sunday 12 Tuesday Saturday Sunday 13 Tuesday Thursday Sunday 14 Tuesday Thursday... CHI MINH CITY International School of Business Hai My Duong (NON FIXED- DAY SHIPPING SCHEDULE IN TAN CANG SHIPPING AFFECTS TO CUSTOMERS SATISFACTION) MASTER OF BUSINESS ADMINISTRATION... change their intension that having fixed- day shipping schedule is more important than full fill each trip Background information Tan Cang Shipping Joint Stock Company (or Tan Cang Shipping – TCS)