DISSERTATION SYNOPSIS SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF

POST GRADUATE DEGREE IN INTERNATIONAL BUSINESS

BLURRING LINE BETWEEN

SHIPPING & LOGISTICS

SUBMITTED BY:

SANKALP DHEER

MBA-IB (2009-2011)

Roll No. : A1802009073

FACULTY GUIDE

Dr. Kshmata Chauhan

AIBS

AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA

AMITY UNIVERSITY – UTTAR PRADESH

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Introduction
Shipping industry - changing profile

The contours of shipping industry is changing rapidly. To ship goods now means to transport
goods not only by ocean mode but also by any form of conveyance. In the age of “stick to
core competency”, shippers are willing to pay a premium to one who takes the entire
responsibility of transporting goods from suppliers’ doors to their door and from theirs to the
customers’.

Shipping is today losing its identity as an independent industry, increasingly getting merged
with the overall transportation sector.

Transportation business itself is transforming itself into larger logistics business which
includes inventory management, warehousing, packaging and customs clearance with a
promise to deliver door-to-door service. In this era of integrated logistics and multimodal
transportation, traditional ship owning is increasingly getting commoditized - a challenge
faced by every ship owner worldwide.

The threat also presents enormous opportunities to ship owners. As the report of United
Nations Conference on Trade and Development - Review of Maritime Transport 1999 notes
that these opportunities “…opens the door to an industry that is estimated to provide for an
annual business volume of around USD 40 billion and, most importantly, for above average
growth rates…” hence there is evidence to support that the change has started to take place a
decade back, now there is serious need from the side of the shipping lines to understand that
the direction of the change

The trend is most strong in container shipping where majors like P&O-Nedlloyd, Maersk etc.
have established systems to take responsibility of total logistics requirements of their clients.

While a pure shipping company was entirely dependent on assets in the form of ships,
containers etc. a logistics service provider has to develop extensive inland transport
capabilities, first-rate port facilities, sophisticated information technology and most
importantly well-trained personnel. The trend is increasingly catching up in other goods,
including bulk commodities, where shipowners are taking responsibility for door-to-door
transportation.

The new role of a total logistics service provider profoundly changes shipper-carrier
relationships from a short-term assignment based to a long-term continuous one. The logistics
service provider is integrated in production and marketing processes of the shipper. Prices
and conditions negotiated bear little relevance to the traditional ocean tariff or the commodity
and destination. Focus is not only to satisfy the client but also the client’s client.

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Need for greater coordination between various players and rapid development of information
& communications technology has led to transportation and logistics industry increasingly
getting segmented into two parts:

 flow of physical goods

 flow of information

Flow of goods requires trucks and vessels while flow of information requires a well
developed IT and communications infrastructure and skilled manpower. Thus a logistics and
transportation service provider not only has to build a large fleet of physical assets in form of
vessels, trucks, rail infrastructure, warehouses etc. (or tie up with operators in command of
such assets) but also build up such assets as IT infrastructure and expertise over business
processes-much more sophisticated and extensive than applicable in any single sub-segment.

The increasing debundling of information flow from flow of physical goods can be
highlighted by increased demand from shippers for such real time information as scheduling,
cargo movement status, online support, reservation & price quotations, etc., and increased
necessity to maintain and process huge databases for successful operations on part of service
provider.

Logistics industry is not just a simple agglomeration of physical infrastructure constituting

each sub-segment but a complicated interplay between them. Expertise over this “interplay”
is what constitutes the “soft” assets of a logistics service provider and highly critical to
success of the venture.

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Objective
In most lucid words this study focuses on “investigating whether there is change in
the expectations of the customers, that is the shipper, from shipping line
regarding the coverage of services by them”.

To get into detail of the above statement I would like to put forth following points,
which would also emphasis on the significance of the study:-

 Understanding when this change did actually started to emerge, this study will
determine the extent to which this change has taken place till now.

 The study will depict views from both the angles, that is, shipper as well as the
shipping line, so that the research could be balanced.

 What are the expectations of the customers which has lead to this change.

 What changes have the, shipping lines bought to cope with this flux.

 This study, would also try to forecast the future course of this wave of change. So
that shipping lines could equip themselves with the relevant skills required to
satisfy their customers.

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Research Methodology
Types of Research

For the purpose of the study I will use descriptive study, the reasons for using this
study are enumerated as following –:

1. It will be more specific as the nature of subject focuses clearly on particular

aspect of change in relationship between shipping lines and the shippers.\

2. This study shall be used to get into details, if the further investigation is
required, by the way of formulating more sophisticated studies, which would
focus on the more specific issues like what changes should shipping lines
should bring to there working.

3. The nature of the study is such that it cannot only rely on one method of
investigation, thus it needs more then one method to collect data.

Type of Data Used:-

The study will require usage of two types of data-
 Primary Data
 Secondary Data

Sources of Primary Data:-

 Questionnaire
 Interview Schedule

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 Sources of Secondary Data:-
 Internet
 Journals
 Reports by various international bodies as well as the organizations in the related sector.

Target Group/ Population:-

Research focuses on two traits that is, logistics and shipping, so the target population will be
divided in to two parts-
 Shippers
 Shipment service providers, which includes people associated with people associated with
shipping industry.

Area of Study:-
Delhi, Ludhiana, Mumbai, Gujarat

Tools for Data Collection:-

Recording forms shall be used to extract information from the target respondents by the way
of direct or telephonic interviews.

Sample Size:-
 30 from shippers’ side
 30 from shipping lines’ side

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Questionnaire:-
The study requires usage of questionnaires, so that interview can be conducted in a
standardized and structured manner, to take insight on both the perspective, the study
requires having two different types of questionnaires for both the groups.

Following are the types of questions that will be included in the questionnaire-

 Close Ended Question

 Open ended questions
 Dichotomous or two- choice questions
 Multiple Choice questions

SAMPLING
The Basic idea of sampling is that by selecting some of the element in a population in order
to get first hand information of study. This study requires usage of samples from both the set
of populations that is from shippers’ as well as shipping lines’ segment.

Type of Sampling Technique Used

 Judgment sampling
The reasons of choosing these sampling techniques are as follows:-

1. This technique would enable the study to collect information from the subject
or respondent who is in the best position to provide the information required.

2. The subject chosen is expected to have expert knowledge by the virtue of

being in the regular trade of shipping or resource procurement/distribution.

3. This sampling technique will provide the most relevant information from the
specific sample of the people.

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Technique used for analysis & interpretation:-
 Bar Diagram & Pie Chart
 Percentage Analysis
 T test

Hypothesis

H0 : there is no significant difference between service expectation from customer and service
delivered by the shipping lines.
H1: there is a significant difference between the service expected by the customers and the
service delivered the shipping lines.

Scope of the study

The study tries to portray a comprehensive picture of the scenario and the flux that has
been created in the shipping industry, the extent of the study covers following:-

1. This study would cover the various shipping liners, so that various point views
could be gained by which the study could be made even in the between the
segments more balanced.

2. This study would bring all genres of material handlers, procurement officers,
operations managers and all other relevant entities from the arcade of the
shippers to bring heterogeneous opinions.

3. To get an insight on the services presently offered, customers expects to be

offered and the services that should, reasonably be offered to sustain following
aspects will be discussed-:

 Services provided by the shipping lines.

 Requirements of the services by the shippers/customers
(material mangers, procurement officer, operation
managers etc).
 Services that comes under the scope of logistics.

4. The study reflects the future course of action of the shipping lines in the suit of
managing this change.

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 Limitations

 Area of coverage
The scope of the study is limited by the area of the coverage, the geographical area that
is covered in the study is limited to the some locations of India only, which by the virtue
will not be able to reflect the enormity of the issue of the study.

 Sampling technique
The sampling technique that is required for this study is judgmental and non
probabilistic in nature, the reason for using this technique is the non availability of the
information on this topic among the masses. But judgmental sampling is inherited with
the problem of not reflecting the opinion of the whole population.

 Lack of financial support

Lack of funds during the project hinders the geographical area of the coverage for which
the study could have been made, the study, as written earlier is limited to India which
makes the opinion restricted to Indians only.

 Lack of availability of data

The study is quiet pioneering in its nature, so a naturally there is not much of the data
and information available for the sake of conducting this study, which makes the study
loose on the theoretical backing.

 Less manpower
Study suffers from acute shortage of manpower, the study is conducted under the
guidance and supported by the AIBS and by the very able Dr. Kshamta chauhan, but this
knowledge capital can be properly utilized if the study has more field data collectors.

 Non responsiveness & reach

The study would be conducted on an elite segment of people, who will be belonging to
the higher level of hierarchy, this will be true for both the areas of respondents, hence it
will be difficult to reach to them and extract complete and relevant information.

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Chapter Plan

To conduct a study it is necessary that it must go through a structured and an organized

set up, this reduces the scope of error and makes the study verifiable and the outcome
from the study becomes reliable to put in application. For the sake of achieving the
stated objective, following is the brief description of chapters that will be included in the
study-:

Chapter1- introduction

This chapter is designed in such a way that it gives description of the study, parties who
are involved in the study. The chapter depicts the reason for conducting this research at
all. Chapter provides the reader with the necessary background for shipping industry,
logistics industry as well as the clients/customers to these industries.

Past trends shall be explained which would be appropriate in showing that the study is
actually in the middle of the process of evolution in the industries which are responsible
for the foreign trade in general and the future if the industry which is going to a hybrid
of logistics and shipping, hence connecting both ends, that is, customer as well
customer’s customers. Following is the diagrammatic representation of the scale
operation of shipping industry

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Chapter2- literature review

The study focuses in the specialized area of, hence there is no special literature available
in this regard to review, though UNCTAD’ s review of maritime transport ,1999, puts
some light in the context of this shift. Some chapters specifically reveal the changes that
are taking place in the shipping industry to cater their clients in a better way. To be
more specific the chapter VI and chapter IV.

These chapters puts a light on general change in the scope the industry , changing lines
of trade, shipping lines converting into full service houses providing end to end services
to its customer. Further readings from United nation’s conference on trade and
development’ s review of maritime transport in the subsequent years shows that this
change is pervasive in nature and will continue till a new equilibrium is established.

Though these reviews are based on the data, hence only deductions could be drawn out
of it, to make these deductions more concrete it must investigate the matter in thorough
detail.

Chapter 3- Methodology

The study encompasses various methods to gather information on the subject from
sources that have specialized knowledge in the field. In an endeavor of making this
study comprehensive in its totality, views from both the perspectives shall be taken
from all various location of India. These subjects shall represent population of a
specialized nature and will be selected on the bases of judgment of the interviewer.

The interview shall be conducted by the way of structured forms, that is, the
questionnaires, these questionnaires shall be filled by respondents in an one to one
interview done personally or telephonically and even sent through electronic mails.

To provide reference to the study, various sources of secondary data shall also be
employed, this data will be coming from the trusted sources like UNCTAD, trade
journals etc. so that the authenticity of data could be relied upon.

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Chapter 4- Presentation of data

Presentation of the data is required so that the user/reader can get better
understanding of the purpose as well the implications of the issue studied. The data
collected from various means shall be presented by the means of various statistical
charts, which would reflect a vivid picture of the blurring line between shipping and
logistics industry. Following are some of the options that shall be used –

 Column charts
 Bar charts
 Pie diagram

Chapter 5– Analysis of data

A research without utilizing the right method for analysis of the finding is incomplete
and invalid. So the data collected from the survey has to go through a analysis process,
this data shall be analyzed by using-

 Percentage analysis
 T test

Reason for using percentage analysis is that, that even the most unknowledgeable
reader can understand the implications issue and the direction in which the change is
taking place. Another test that is used is t-test, this test will help us in understanding
what is the change in perception and expectations of the customers and as well as the
services offered by the shipping lines.

Chapter 6-Interpertation of the findings

A study requires the meaningful interpretation of the findings from the data collected
after the application of tests and other analyses tools, so that one can refer this text to
draw deductions from this text without actually using the tools for analysis himself.

This requires interpretations in the words that are most easily understood by the
people who are not related to the industry as this study shall not only be useful to the
shipping lines or the logistics industry but also to the industry personnel who are
required to get the services from these industries.

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Chapter7- Conclusions, implications and recommendations

though the change is quiet evident in the industry, but still this assumption could be
diluted or strengthen by the research, this will be done when the interpretations will be
used to draw conclusions for the research, the conclusion will not complete the task of
this study as scope of the research extends it to providing a foresight into the industry,
which would tell us, what will be the type of industry structure for shipping industry
after this phase of evolution is over.

Though to go a level ahead, the research shall not restrict itself in providing points of
recommendations to both, the shipping industry as well as the users of the services of
the industry. The research will tell level of services that shipping lines shall provide and
upper limit of services that customer must expect from the shipping lines, so that the
shipping industry do not loose its distinctive image in contrast to logistics

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Bibliography

Books, journals & reports

Research methodology methods and techniques, by Kothari CR, new age international
publishers Marketing Research, Dacid j. luck Ronald S.Rubin Prentice Hall of India Pvt.
Ltd
Shipping industry report, ICICI direct, equity research,2010

United nation’s conference on trade and development, Geneva- “review of maritime

transport”(1999 and 2009).

Indian shipping industry- a report by i- maritime, research and information division.

websites

http://www.ibisworld.com/globalindustry/default.aspx?indid=1540

http://www.equitymaster.com/research-it/sector-info/ship/

http://www.mindbranch.com/Shipping-India-R377-0054/

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