The Role of Supply Chain Improvisation And Enhancing EXIM Business

Supply Chain Management

Supply chain management is the handling of the entire production flow of a good or service-starting from the raw components all the way to delivering the final product to the consumer. A company creates a network of suppliers (“links” in the chain) that move the product along from the suppliers of raw materials to those organizations that deal directly with users.

Types of Supply Chain Management in EXIM Business

1) Just-in-time manufacturing - Just-in-time manufacturing is all about making stuff exactly when you need it, no more, no less. It's like a money-saver because one doesn't have to stockpile a ton of materials or pay for extra storage space.

2)? Vendor management - It’s a critical business process that involves evaluating and monitoring supplier performance, establishing clear expectations, and implementing quality and delivery standards. This approach is designed to guarantee that suppliers align with the company's requirements, ensuring the timely delivery of products that meet the specified criteria.

3)??Inventory management - Inventory management is the process of tracking stock levels and ensuring that adequate inventory is available to meet customer demand. This can involve techniques such as just-in-time manufacturing and order batching.

4)??Transportation management - Transportation management is the process of coordinating the movement of goods from suppliers to customers. This includes planning routes, scheduling shipments, and managing transportation providers.

Major Players in Supply Chain Logistics

Large companies and corporations tend to handle SCM using one of two options

• They use third-party logistics (3PL) companies to help manage the entire process, from origin to end user. Major 3PL players in global trade include C.H. Robinson, XPO Logistics, J.B. Hunt, and Kuehne+Nagel.

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• The future of 3PL is next-day delivery from big-box warehouses which have taken over logistics formerly done by 3PLs. They now run the entire process internally, buying their own ships, trucking companies, etc.

Characteristics of a Strong Logistic Partner

• They have a strong global presence.
• They are technologically savvy and strive to innovate.
• Their top priority is ensuring customer satisfaction. With just a single call, they provide clients with the answers they're looking for, leaving them content with the outcomes.

Biggest Shipping Companies

We're talking about a massive 11 billion tons of goods cruising the seas each year, breaking down to roughly 1.5 tons for every person on this planet. With globalization at its peak, shipping is the beating heart of today's global game.

1. Maersk

Danish company Maersk has held the title of the world's largest shipping company since 1996 with over 4 million TEU throughput in 2020. Founded back in 1904, this shipping giant raked in over $39 billion in revenue in 2019, boasting an operating profit of approximately $3.8 billion.

• TEU capacity of the company in 2020: 4 097 898
• Total market shares of the company in 2020: 16.9%
• Number of ships owned by the company in 2020: 705

?2. Mediterranean Shipping Company

The Mediterranean Shipping Company, an Italian-Swiss venture, set sail half a century ago. With revenues exceeding $28 billion and a workforce of 30,000+, it was established in 1970 in Naples by seafarer Captain Gianluigi Aponte. Over time, MSC expanded its fleet, reaching Northern Europe, Africa, and the Indian Ocean by 1977. Their journey didn't stop there; by the late '80s, MSC had ships connecting to North America and beyond.

• TEU capacity of the company in 2020: 3 860 388
• Total market shares of the company in 2020: 16%
• Number of ships owned by the company in 2020: 579

?3. COSCO Shipping

China's biggest shipping player is Cosco Shipping, headquartered in Shanghai. This mammoth operation is a state-owned titan in the transportation and logistics realm. It was formed through the merger of China Shipping Company and COSCO Group and stands as one of the largest shipping companies on the globe.

• TEU capacity of the company in 2020: 3 022 882
• Total market share of the company in 2020: 12.5%
• Number of ships owned by the company in 2020: 503

4. CMA CGM?

France's leading shipping company, CMA. Born in 1978, it now boasts 200+ shipping routes, a presence in roughly 150 countries, and a hefty revenue of over $30 billion, with a net income of $229 million. With a workforce of over 110,000, it's a significant player in the industry.

• TEU capacity of the company in 2020: 3 015 458
• Total market share of the company in 2020: 12.5%
• Number of ships owned by the company in 2020: 570

5. Hapag-Lloyd

Hapag-Lloyd is Germany's top shipping company. With its headquarters in Hamburg, it sails with revenues exceeding $12 billion and a workforce of many. The company was born in 1970, a product of the merger between two German giants: Hamburg-American Line (HAPAG), established in 1847, and Norddeutscher Lloyd (NGL), formed in 1857.

• TEU capacity of the company in 2020: 1 730 615
• Total market shares of the company in 2020: 7.2%
• Number of ships owned by the company in 2020: 240

Export Through Railways

The history of the railway dates back over 2,000 years, with primitive concepts of tracked transport going back to the Ancient Greeks. With the innovation of Steam Power Engine railways started to play a central role in local and international trade.

Railways play a crucial role in international trade and freight transportation. They provide a cost-effective and efficient mode of transport for goods across countries.

Indian Railways - Indian Railways is a crucial component of India's logistics sector, transporting 1.4 billion tonnes of freight annually on a 68,000-kilometer network. It supports balanced socio-economic development by moving commodities such as coal, iron ore, food grains, and more

The Association of American Railroads oversees rail transport in the U.S., facilitating international trade by moving goods like Canadian lumber, plastic pellets for Asian exports, and consumer goods in containers. Freight rail plays a crucial role in sectors like agriculture and automotive.

The Ferrari of the Railways (High-speed rail for Freight)

In 2012, Italy became the first European country to introduce privately owned high-speed trains known as Italo, manufactured by Alstom. These trains, often called the "Ferrari of the railways," connect Rome to Naples in just over an hour.

Freight trains operate overnight between Bologna and Caserta, near Naples. Trenitalia's high-speed railcars, known as Frecciarossa, can reach 300km/h speeds and cover the Milan to Naples route in under five hours.

Top Countries with Largest Railway Network

1.??United States - 250,000 km - The US rail network, with an operating route length of over 250,000 km, is the biggest in the world. Freight lines constitute about 80% of the country's total rail network, while the total passenger network spans about 35,000 km.

2.??China - 124,000 km - China's rail network, the world's second-largest at over 124,000 km, is operated by the state-owned China Railway Corporation. In 2013, it transported 2.08 billion passengers (second only to Indian Railways) and 3.22 billion tonnes of freight (second only to the US). China aims to expand its rail network to over 270,000 km by 2050.

3.??Russia - 86,000 km - Russia's whole network, operated by state-owned monopoly Russian Railways (RZD), runs for over 86,000 km. In 2013, the network carried 1.08 billion passengers and 1.2 billion tonnes of freight - the third-highest freight volume after the US and China.

4.??India - 68,525 km - The Indian nationwide rail network, the fourth longest in the world, is owned and operated by state-owned Indian Railways and includes an operating route length of more than 68,525 km.

5.??Canada - 48,000 km - Canada boasts the world's fifth-longest national rail network, spanning 48,000 km. The major freight rail networks, Canadian National Railway (CN) and Canadian Pacific Railway (CPR), play a pivotal role.

Movement of Containers

Container manufacturers are the backbone of the shipping industry. They’re the pillars that keep the global equipment fleet afloat. Container manufacturers are companies that build shipping containers of all shapes and sizes from scratch. Many big players in the industry, such as shipping lines, container leasing companies, and container trading companies work directly with container manufacturers.

India’s Journey in Container Making

In line with the Make-In-India and make for the World initiatives, India has been able to export cargo containers to Europe despite direct competition from China. Kalyani Cast Tech (KCT) exported 360 dry cargo containers worth $ 1.4 million to Europe.

Kalyani Cast Tech Limited (KCT) plays a crucial role in logistics, offering a daily capacity of 12 containers for import substitution and exports. KCT has been in the container manufacturing business for three years, adhering to international standards and specializing in critical components like corner casting. They have also pioneered innovative container designs, including dwarf containers, cube containers, 25 ft ISO containers, 42 ft coil containers, and bulk containers, aimed at helping customers reduce transportation costs.

Conclusion

The EXIM industry relies heavily on a robust supply chain, acting as the lifeblood of international trade by enabling the movement of goods and services across borders. The supply chain's efficiency directly impacts the success of businesses and a nation's economic growth. A well-managed EXIM supply chain ensures timely deliveries, cost reduction, risk mitigation, and improved customer satisfaction.

?It encompasses various interconnected activities like sourcing, procurement, transportation, warehousing, and distribution, all requiring meticulous planning and collaboration among stakeholders, including manufacturers, exporters, importers, logistics providers, and regulatory bodies.