PK* talks:
As I have helped someone doing the research in marine law and transportation for many years, I have also learned so many things about the import & export including logistics and the operational management.
Shipping is not only about finding a product, contacting the shipping company, and making a payment, but also about the law and supply-chain management. When you export some products, to prevent the lost and increase the benefits, there are so many tricks and laws that you should pay attention to. In the real world, the unexpected situations during the transportation (e.g., the delay of shipping and the damage of cargo) always happen all the time. For example, I have seen in many cases that the improper packaging of the chemical products exported often damage the other products in the cargo nearby too.
According to Stalk, one of the gurus from the “Boston consulting group”, there are three types of the costs in shipping: 1.) Direct costs, 2.) Indirect costs, and 3.) Hidden costs. In my opinion, the ones that most people don’t know is the indirect costs, such as the costs of insurance and the hidden costs like the delay that causes a shortage of products selling in the stock. This drives down economics profits for the importers while accounting profits may still look good on paper. Thus, even the best accountant in world couldn’t help you here; we need a wider perspective.
It’s even more difficult for the importers and exporters who ignore these issues to survive since today there are more competitions in treading agreements. There are too many cargo containers waiting to be loaded and unpacked at the ports. Now, China is trying to expand their ports’ capacity but that needs several years in progress to finish and pass the law. In Thailand, they also have a Bangkok port and some new ones in the south. This implies the increasing of demands in the world.
Yet, the rate of economic growth in the global level is slow down, but normally, the economy will go up and down in the circle. Once the global economy has been recovered, the basic rules of supply & demand will play a major role in the marine transportation again. The product lifecycle is now getting shorter and that means the faster you respond to the demands of customers, the better chance you will get a good market share. Then without having a good integrated supply chain managing, the companies will not simply survive, especially if the impacts of the economic crisis still exist.
PK* [Jan.04, 2009]
[1] Stalk, “5 Future Strategies You Need Right Now”, Memo to the CEO: Harvard Business Press (2008 )
