EXPORT IMPORT PROCESS OF SHIPMENT

Submitted by

VARSHASINGH
PGDM GEN Roll No-56
UNDER THE GUIDANCE OF

MR. S.K SINGH

APEEJAY INSTITUTE OF TECHNOLOGY GREATER NOIDA

Exportimport of shipm nt ACKNOWLEDGEMENT

Life of human beings is full of interactions. No one is self sufficient by himself whenever anyone is doing some serious and important work a lot of help from the peo ple concerned is needed &one less specially obliged towards them. I cannot forget acknowledging them in few words as without the guidance & co ordination of them in my project report would not have been possible.

A large number of individual contributed to this project. I am thankful to all of them for their help and encouragement. My writing in this project report has also been influenced by a number of website and standard textbooks. As far as possible, they have been fully acknowledged at the appropriate place .I express my gratitude to all of them. First of all I owe my heartfelt gratitude to my guide prof. prof.S.K SINGH forhis noble guidance throughout the completion of theProject.I would like to extend my heartfelt thanks for giving me an opportunity to work on this project.

I must also thank my parents for their blessings and moral support . Last but not least, also give my sincere thanks to all the people to directly indirectly have help and encourage me in finding the way to us collecting the requisite information and completing the project effectively and timely.

Varshasingh PGDM general Roll no. - 56

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GUIDE CERTIFICATE
TO WHOMESOEVER IT MAY CONCERN

Thisis to certify that the project report titled

EXPORT

IMPORT

PROCESSOF

SHIPMENT

Offered by Committed cargo Pvt. Ltd.has been prepared by varshasingh,Roll No.- 56,a student of PGDM (Post Graduation Diploma in Management), session (2010-12). The study was conducted with special reference to committed cargo carePvt.Ltd. C.B.D. Belapur, Navi Mumbai. I recommend this project for evaluation.

Place: Date: PROF.R.K VERMA Director

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INDEX
age o.

Introduction of study Objective of study12 Research Methodology13 Research Design14 Scope of the Project15

Company Profile17 Organization Chart25 Benefits Given by company26

Theoretical background27 Data Analysis and Interpretations58 Findings68 Bibliography72

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INTRODUCTION OF STUDY

This project is all about to know about export import procedure of shipment. This project puts more focus on to know custom clearness, to make export - import invoice, to get shipping bill number from custom department etc. This project will also find out how Committed cargo Pvt.Ltd. could sustain in the competitive world by providing vast range of cargo handling through all instruments which flexible prompt and innovative in meeting the requirement of the customer. The purpose of the study was to know about export import documentation of seaway in the committed cargo Pvt.Ltd. Exceeding target At a meeting of representatives of the coir exporters with the Board officials to discuss issues related to exports, Mr V.S. Vijayaraghavan, Chairman of Coir Board, thanked exporters for their collective efforts in surpassing the export target last year, both in quantity and value, despite tremendous odds and conspicuous global impediments.

Forex Earnings Indian coir exports during 2008-09 had touched 1,94,791 tonnes valued at Rs 634 crore, exceeding the target set for the year. Coir export was 1,87,566 tonnes valued at Rs 592 crore during the previous year.

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Sales turnover The 30-odd Coir Board showrooms spread over the country had achieved a sales turnover of Rs 11.19 crore, accounting for 86.10 per cent of the Rs 13-crore target fixed for the year 2008-09. The meeting also considered suggestions to revamp these showrooms and sales depots through out the country in tune with the growing expectations of all sections, especially the upper strata of society in order to remain competitive in the domestic market. In this background, Mr Vijayaraghavan was confident of achieving the revised sales target of Rs 15 crore set for the showrooms in the country for the current year.

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OBJECTIVE OF THE STUDY

The main objectives of the research was :

 To know about export import process.

 To know what are the documents required before and

after sailing the cargo.

 To know different type of container used in shipment.

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RESEARCH METHODOLOGY

Collect data/information about cargo through:

 Primary data collection:y E-mail y Telephone y Invoice y Packing List

Secondary data collection :y Invoice y Packaging list y Shipping bill y Internet

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RESEARCH DESIGN

Research design is the based framework, which provides guidelines for the research process. It is a map or blue print according to which the research is to be conducts. The research design specifies the methods for data collection & data analysis determine the source of data. Most specifically it was a kind of Descriptive conclusive research who takes care of who, when, where, what, how and why aspects of the investigation further the researcher used the statistical method to serve he purpose of project, it permitted the research to derive more accurate generalization whose reliability could be

measured.

CENTRE: RESEARCH:

ALL OVER INDIA EXPLORATORY

RESEARCH TECHNIQUE :QUALITATIVE & QUANNTATIVE TOOL USED: TELEPHONIC & E-MAIL DATA SOURCE : PRIMARY & SECONDARY

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SCOPE OF THE STUDY

The scope of marketing research could cover the business problems relating to the followings.  Types of consumers that compromise present and potential markets.  Buying habits and pattern of consumption  Size and location of different markets, not only in India but also overseas.  The prospects for growth or construction for the current markets being served.  New mantras of emerging segments.  Marketing and manufacturing capabilities of competitors.  Most suitable entry timing.  The current and prospective competitive position.  Chances of improvement of current channels.

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COMPANY PROFILE
INTRODUCTION OF THE ORGANIZATION
Overview

An ISO 9001:2000 Company Incorporated head quarter in the national capital Delhi, Indiaand specializes in handling Import & Export Cargo. Earning and maintaining a reputation for dependable and complete worldwide cargo movement solutions wi th the motto Customer Pride achieved this longevity in the volatile cargo industry. Committed Group has established its hub at Los Angeles, Toronto, Shanghai, Mumbai, Jaipur, Ludhianaand a reliable network of associate offices in Indiaand world over an d is specialized in forwarding of cargos choosing the most convenient andcost effective transportation method by air, courier, seaand truck any time & anywhere around the globe. Committed Group management has the right mix of experience and commitment and is fast to adapt to new emerging technology. Its well established network and tracking software enables to provide fastand reliable information to its client. Thus capable of handling

 Packaging  Warehousing  Freight forwarding  Clearance of Export and Import Cargo  Commercial, Diplomatic and Non-Diplomatic Consignment.  Projects

Mission Statement To be focused as a pro -active cargo gateway by anticipating and reacting to each stage of a shipment's transit with commitment and to experience strategic growth of a highly respected and recognized cargo company in the Industry.

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The Committed Group management team brings together leaders with a wealth of expertise from various industries, including transportation, logistics, cargo management, professional services and customer service. These individuals form a strong foundation that provides vision and support to a growing team of talented, dedicated professionals working to adopt and deliver professio nal freight forwarding solutions and custom clearance. The Operational team at Committed Group comprising of more than 50 in-house trained energetic and aggressive group of employees with several years of experience in the international freight forwardi ng plus an protracted experience in the reputable shipping lines and airlines. Thus, with strong gamut of professional from cargo industry under one roof help Committed Group to adopt the "Total Freight

Management" approach, a feature of which is the ha ndling of client cargo on a door-to-door basis. This approach ensures the correct management of cargo in a cost-efficient andprofessional way at competitive price and feels Committed Group is the RIGHT PARTNER FOR YOU. Services

 Air Freight  Custom Clearance  Document Processing  Multi Modal Facility  3 PL & Supply Chain Management  Packaging & Warehousing  Tracking & Tracing

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At Committed Group it is a single window contract for the carriage of goods by at least two or more different modes of transport. Thus, providing a permutation-combination between air- ocean-surface modes to reduce the cost of transportation. This includes Door pick to Door delivery and a complete logistics support constituting of: Origin Pickup/Trucking. Warehousing if required. Customs Clearance & Documentation at origin. Origin charges payable like THC, B/L Fee etc. Carriage by Sea or Air by payment of Freight. Inland Trucking if required. Customs Clearing of goods at destination and Warehousing if need be. Door Delivery of the cargo.

Committed Group operates as Multimodal Transport Operator (MTO) providing the end 2 end services like: DDP: Delivered Duty Paid Shipments. DDU: Delivered Duty Unpaid Shipments. CI Shipments: Cargo picked up on costand insurances terms FOB: Free on Board Shipment. Only Port to port or Apt to Apt service by Carrier. Ex Works: Pick up if cargo from shippers warehouse/factory. Multimodal Transport (MT) Document Services along with logistic documentation evidencing a multimodal transport contract which can be replaced by electronic data interchange messages insofar as permitted by applicable law and be (a)Issued in a negotiable form or, (b) Issued in a non-negotiable form indicating a named consignee. Delivery of the Cargo through Multimodal facility This is done after completion of various documentation and formalities after the arrival of the shipment at destination. The Cargo delivery is subject to various terms and conditions to be fulfilled by the consignee as listed below:

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1. Payment of all applicable charges to the delivery agent of the carrier. 2. On presentation of Duly Endorsed Original Bill of Lading (for Sea / Ocean Shipments). 3. For Air shipments, an Authority Letter is required. 4. Original DIC. 5. In case of shipments under L/C, the designated Bank need to endorse the Bill of Lading or issue A Bank Release Order in favour of the carrier.

6.When no document has been issued, to a person as instructed by the consignor or by a person who has acquired the consignor's or the consignee's rights under the multimodal transport contract to give such instructions.

Period of responsibility The responsibility of Committed Cargo CarePvt.Ltd. as a Multimodal Transport Operator (MTO) for the goods under these Rules covers the period from the time the MTO has taken the goods in his charge to the time of their delivery. The multimodal transport operator shall be responsible for the acts and omissions of its employee or agents, when any such employee or agent is acting within the scope of his employment, or of any other person of whose services he makes use for the performance of the contract, as if such acts and omissions were his own. Packaging & Warehousing Packaging at Committed Group Committed Group employs professional packers and experienced supervisors who are trained packing and packaging. We specialize in handling fragile / heavy / oversized cargo. For packaging, we use material like craft paper / soft papers, corrugated rolls & boxes, air bubble pack rolls, polythene & polypropylene, and masking tap e, etc. depending upon the requirement. Warehousing at Committed Group Committed Group offer warehousing facilities to support export import activities. The warehousing facilities are very helpful to

accelerate the transportation of goods, especially for cargos with LCL Status. We use authorised warehouses located worldwide.

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Further to our covered warehousing facilities are provided for storing of FMCG, industrial and high-end sophisticated products on transit. The warehouses are equipped with dedicated loading and unloading bays.

Services include: Complete Supply Chain Operations: End-toEnd

 Full

Case Pick Modules Pick Modules

 Split Case  Tilt  Sliding  CAPSLine  Pick-to-Light  Kitting

Tray Sorter Shoe Sorter

 Product/Process QA Management  Performance-driven Controls  Standard and Customized Reporting  Inventory control  Private and Public Delivery Network 
Invoicing

 Call Centre Support  Diverse Product Categories Returns processing  Assembly and inbound / outbound freight management.  Accounts Management, and advanced in -house Systems Support.  A-frame andReal-Time RF-Controlled Inventory System

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 10-15% reduction in transportation costs  Real-time monitoring of inventory, orders and events 
Intelligent order sourcing across multiple stocking locations

 10-15% cost improvement for fleets

Tracking & Tracing Committed Group big advantages offer to our customers is the one stop online track and trace facility. Through this site you now have the ability to monitor your consignments online or web access at any time, day or night, without the need to constantly refer back to your forwarder. Our system offers access on a 24/7 b asis for all consignments shipped by road, seaandair.

BENEFITS GIVEN BY COMPANY

 Origin Pickup/Trucking.  Warehousing if required.  Customs Clearance & Documentation at origin.  Origin charges payable like THC, B/L Fee etc.  Carriage by Sea or Air by payment of Freight.  Inland Trucking if required.  Door Delivery of the cargo.

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THEORETICAL BACKGROUND
LOGISTICS SYSTEM Logistics is defined by the council of Logistics, OhioUSA as the Process of planning, implementing and controlling the efficient, co effective flow andstorage flowand storage of raw materials, in process inventory finished goods and related information from point of origin to point consumption. More simply, the objective of Logistics System is that the right products reach the right place in the right quantity at the right time to satisfy customer demand.

ELEMENTS OF LOGISTICS SYSTEM

     

Nature of Product Location of Manufacturing Plant Availability of infrastructure such as Road Availability of different modes of transportation Dealer/Distributor Network Government Policy

MODE OF TRANSPORTATION

 AIR TRANSPORT  OCEAN TRANSPORT  RAIL TRANSPORT  ROAD TRANSPORT

OCEAN TRANSPORT More than 95percent of international trade is conduced by sea routessince ancient times, sea routes are being used for

transportation of cargo from onecontinent or country to Coastal shipping is also used for transporting th e cargo from oneport within the country to another. For example in India the cargo can

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be transported from Chennai port to Visakhapatnam port using the costal shipping route. Sea routes are used for carrying bulj commodities like such as coalingand thermal coal mires, fertilizers rock phosphate etc, and liquid go like crude oilammonium acids etc Ideally the goods with high volume andkiwvakyeare suited die ocean transport in the era of containerisation even the high value cargo can be safely enabled the cargo carrying capacities of the ship t o increase many fold.

Cargo

ship categorised into followings:-

Liners ships : Liners ship represent the organized sector of the

shipping industries due to their fixed schedules of arrival and departure, Pre-determined voyages and trade routes and published ocean freight rates. Liner shipping is governed by shipping co nference and offers the following advantage to shippers: -

 Regular sailings to scheduled ports of call.  Uniform rates for all shippers.  Coverage of wide range of ports.  Rebates of freight rates based on loyalty agreements.

Tramp ships:- Tramp ships on the other hand have the

following characteristics

 They are free to move any where on the high seas at their
will.

 Their voyage routes and schedules are flexible.  They arrive or depart without a fixed route or schedule.  They fix their voyages according to availability of cargo
and as per the requirement of the shippers of these cargoes.
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 The cargo space on the tramps is booked by the

brokers located in major port cities like New York, London, Rotterdam Hamburg, and Hong- Kong etc.

STANDARD CONTAINERS

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Int rnational

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ransaction

Exportimport of shipment EXPORT PROCEDURE AND DOCUMENTATION

21

In India, ships transport more than 90 per cent of the cargo. It therefore interesting to study the export processed by ship documentation related to it. Processing of an export order ----i. Exporter operation starts with the receipt of enquiry by the exporter from importer. Bar on the enquiry exporter submits his offer giving complete details of products technical specific price delivery payment terms etc. ii. After the process negotiations importer sends a pu rchase order follow by letter of credit (if applicable). iii. The exporter manufactures the goods specification given in purchase order. according to the

iv. As soon as the goods are ready the exporters invites the representative of Export inspections agency (EIA) for p re shipment inspection and obtain the certificate of inspection. v. After that, the exporter prepared following documents: ----

 INVOICE  PACKING LIST  ARE1 FROM EXSICE DEPARTMENT  MARINE INSURANCE POLICY  COPY OF PURCHASE ORDER / L/C vi. Above those documentation sends to CHA by exporter.
vii. Based on these documents CHA agent completes the octroi formalities, obtain port permit and prepare shipping bill which is a customs documents. viii. Custom department check the export cargo on the basis of information provided on the shipping bill. If satisfy then cargo allow to loaded on the board of ship. ix. The shipping line gives mate receipts to CHA agents after the payment of ocean freights and port due obtains the bill of

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lading(B/L) from shipping line .B/Lis a proof of dispatch of cargo and also a negotiable document. x. After that, CHA agent send various documents back to exporter which is  Customs attested invoice

 Copy of shipping bill  Full set of non board bill of lading.  Copy of purchase order or L/C  Copies of ARE1 Form  SDF form
xi. After that the exporter submitted above these documents for negotiation to the bank which include : --- Commercial invoice

 Packing list  SDF form  Original copy of purchases order  Certificate of origin  Bill of exchange  Shipment advice

After that, bank scrutinizes these documents and if found correct make payment to exporter against documentations.

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Step 12

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DATA ANALYSIS

How Big is a Cubic Meter?

Calculation: Length x Width x Height divided by 1728 = cubic feet divided by 35 = cubic meters.

23 BOOK BOXES

11 MEDIUM BOXES

= one cubic meter

(appr x)

(appr x)

(appr x)

r mix and match:

= one cubic meter = one cubic meter = one cubic meter

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13x13x17 inches 1.5 cubic feet 0.043 ubic Meters



18x18x17 inches 3.1 Cubic Feet 0.091 ubic Meters

28

8 LARGE BOXES

18x18x24 inches 4.5 Cubic Feet 0.125 ubic Meters

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Air freight calculation Introduction Airlines that are members of the International Air Transport Association (IATA) are bound by their membership to comply with tariffs issued by IATA. However since 11th September 2002, airfreight rates are now extremely negotiable. Airfreight rates cover transportation from the airport of loading to the airport of discharge. These rates do not include the following:
y y

y y y y

Collection of air cargo from the consignor's/exporters premises Delivery of cargo from the airport of destination to the consignee's premises Storage of cargo before or after loading Customs clearance in the country of destination Any duties and taxes that may have to be paid Insurance

Chargeable/volumetric weight Airline freight rates are based on a "chargeable weight", because the volume or weight that can be loaded into an aircraft is limited. The chargeable weight of a shipment will be either the "actual gross mass" or the "volumetric weight", whichever is the highest. The chargeable weight is calculated as follows: 1 metric ton = 6 cubic metres. In order to establish if the cargo will be a weight or volumetric based shipment. Step 1 Measure the parcel/cargo along the greatest length, width and height of that parcel. For example; 100 cm (L) X 100 cm (W) X 100 cm (H) = 1 000 000 cm3. Next, weigh the parcel; assume it weighs 150kg.

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Step 2 Now divide the 1 000 000 cm3 by 6 000 = 166,66 kg. You have now converted the centimeters (cm) into kilograms (kg) Step 3 Now compare the weight to the volume. If the weight is 150 kg then the airline would base the freight on the higher amount being: 166,66 kg Consolidation Consolidation is an economical method of moving cargo by employing a consolidator. The consolidator receives cargo from a number of suppliers/shippers and then combines these cargoes into one consignment by packing the goods into a Unit Load Device. The consolidator then books the Unit Load Device with an airline. The supplier/shipper would have a contract of carriage with the consolidator of the cargo and in turn the airline would have a contract of carriage with the consolidator. The airline would issue an air waybill to the consolidator when accepting the Unit Load Device and in turn the consolidator would issue the supplier/shipper with a house air waybill. The air waybill The air waybill, unlike the ocean bill of lading is not a document of title to the goods described therein, however it does perform several similar functions these are:
y y y

y y

It is a receipt for the goods It is evidence of the contract of carriage between the exporter and the carrier It incorporates full details of the consignor/shipper, the consignee/receiver and the consignment/goods It is an invoice showing the full freight amount It must be produced, be it in an electronic format, at the airport of discharge for clearing purposes

.Sea freightcalculations

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Introduction Seafreight calculations can broadly be divided into two main components; breakbulk and containerised. In this section we deal with how you should calculate the freight costs of both of these two types of seafreight. Break bulk cargo calculations Break bulk cargo, is cargo that is unitised, palletised or strapped. This cargo is measured along the greatest length, width and height of the entire shipment. The cargo is also weighed. Shipping lines quote break bulk cargo per "freight ton", which is either 1 metric ton or 1 cubic metre, which ever yields the greatest revenue. Step 1 Multiply the metres 2.5 X 1 X 2 = 5 metres Compare to the mass = 2 Mt. Step 2 Calculate the freight with the greater amount either the mass or the dimension. 5 X USD 110.00 = USD 550.00 Freight would be paid on the measurement and not the weight. All shipping lines carrying cargo in a break-bulk form insist on payment based on a minimum freight charge which is equivalent to one freight ton, one cubic metre or one metric ton. Bunker Adjustment Factor (BAF) "Bunkers" is the generic name given to fuels and lubricants that provide energy to power ships. The cost of bunker oil fluctuates continually and with comparatively little warning. Example: Freight rate: Port Elizabeth to Singapore Freight rate: US Dollar: 1 250.00 per 6-M container + BAF 5.2% US Dollar 1 250.00 X 5.2% = US Dollar 65.00

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Add the two amounts together Freight rate: U S Dollar 1 315.00 Currency Adjustment Factor (CAF) The currency adjustment factor is a mechanism for taking into account fluctuations in exchange rates, these fluctuations occur when expenses are paid in one currency and monies earned in another by a shipping company. The currency adjustment factor is a mechanism for taking into account these exchange rate fluctuations. It is always expressed as a percentage of the basic freight and is subject to regular review. War Surcharge The outbreak of hostilities between nations can have a serious effect upon carriers servicing international trade even though they may sail under a neutral flag. Carriers sailing within the vicinity of a war zone may impose a war surcharge on freight to compensate for the higher risks involved and the higher levels of insurance premium, which they may be obliged to pay. Total amount of surcharge 16.5% US Dollar 1 250.00 X 16.5% = US Dollar 206.25 (add to freight rate) US Dollar 1 456.25 Port Congestion Surcharge Congestion in a port for a period of time can involve considerable idle time for vessels serving that port. When a ship lies idle, this creates a huge amount of loss for the ship's owner. Shipping lines therefore have the right to impose a surcharge on the freight to recover revenue lost. Another factor which influences port congestion surcharge would be labour disputes. Port congestion surcharges are calculated as a percentage of the freight rate as expressed in the previous examples. Consolidation services

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The consolidator or groupage operator hires a container from a shipping line and then sells that space to his clients/exporters. The benefit for the exporter is that small quantities which, would not fill a full container load, can be shipped by sea freight in a shipping container as an alternative to air freighting the goods. The consolidator would charge per metric ton or cubic metre, which ever yields the greatest. Example: US Dollar 89.00 Weight or Measure. The shipping line would have a contract of carriage with the consolidator and in turn the consolidator would have a contract of carriage with the exporter. The consolidator would be issued with an combined through bill of lading from the shipping line and then present the exporter with a house bill of lading (See bill of lading below) The bill of lading The bill of lading performs the following functions:
y

y y y

A contract of carriage between the shipper of the cargo and the carrying shipping company. The name of the shipper and the receiver of the goods the consignee. The contents of the packages as declared by the shipper. Shipping details such as: port of loading and the port of discharge. The bill of lading is a freight invoice and indicates if the freight costs have been prepaid by the exporter or will be paid by the importer, "freight collect". The bill of lading states the number of packages, weight and dimension of the shipment. It is a document of title to the goods stated thereon.

Every original bill of lading signed by or on behalf of the shipping company is a document of title to the underlying goods. This special function of a bill of lading is achieved by a form of words which state: "In witness whereof the undersigned on behalf of the shipping company has signed three bills of lading all of this tenor and date, one of which being accomplished the others to stand void".

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ENDORSED BILL OF LADING Bills of lading can only be issued with the words "shipped on board", if the cargo has actually been loaded onto the named vessel at the port of loading. By insisting that the exporter supplies the importer with a "shipped on board" bill of lading, the importer obtains conclusive evidence that the goods have been loaded on board the intended vessel. Some importers insist that the exporter presents "shipped on board" bills as a condition for payment. "Received for shipment", bills of lading can be issued as soon as the goods have been delivered into the custody of the carrying shipping company or its agent either at the point of receipt or at the port of loading. Thus, a 'received for shipment", bill of lading will only indicate the ship in which the cargo is intended to be loaded on. The risk remains that the loading may, for many reasons delayed or the cargo may not be loaded at all. Banks responsible for the payment of funds in payment for goods under letters of credit will not release the funds if the bill of lading has been endorsed "received for shipment".

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Exportimport of shipment IMPORTER

38

PURCHASES ORDER / L/C

EXPORTER

CE

I ICA E I V ICE

PACKI LIST

A E1 M

I SPECTI

MA I E I S A CE P LICY

C & F AGENT

CUSTOMS ATTESTE I VOICE

S IPPI BILLS

ULL COPY UPLICATE UPLICATE SET OF OF COPYA EFORM COPY GR ON L/C FORM BOA BILL OF LA ING

MME I AL I V I E

PA KI LIS

PLI A PY M

EXPORTER E IAB I I LE PIES AL L/ B/L

I I A E I I

BILL EX A E

NEGOTIATING BANK

L/ AM
EXPORTER

S IPPI

ME
IMPORTER

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BIBLIOGRAPHY

Ex o t Im o t Do mentation - P of. D.C. ai Logi ti in International B iness - Prof. Rajeev Aserkar

REFERENCES INTERNET

www. ommittedgro
www.google. o.in www.ask. om www.exit.net

. om

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