IMPORT AND EXPORT OPERATIONS

First Year MBA course requirement

For the award of the Degree of
MASTER OF BUSINESS ADMINISTRATION
Submitted by
ANIRUDH KASTHURI
RA1452001040186
Under the guidance of
ASST. PROF JAYA PRABHA BOSE

SRM B- SCHOOL FACULTY OF ENGINEERING AND

TECHNOLOGY
SRM UNIVERSITY (Ramapuram Campus Part)
VADAPALANI, CHENNAI 600025

BONAFIDE CERTIFICATE

This is to certify that ANIRUDH KASTHURI is a Bonafide Student of

SRM B-School, SRM University, Vadapalani, Chennai. He is in the I year
of Masters Degree Program in Business Administration (MBA). He has
done this project under my guidance and supervision towards part
fulfillment of II year MBA course.

Project Guide

HOD

Date:
Place:

DEPARTMENT SEAL

DECLARATION

I, ANIRUDH KASTHURI (RA1452001040186) studying in I year

MBA program at SRM B-School, SRM University, Vadapalani, Chennai,
hereby declare that this project is a original work of mine and I have
not verbatim copied / duplicated any material from sources like
internet

or

from

print

media,

excepting

some

vital

company

information / statistics, which are provided by the company itself.

Signature of the Student

Date:
Place:

ACKNOWLEDGEMENT

Firstly, I wish to express my deep sense of gratitude and profound

thanks to Dr.Kesavan, Head of the Department of Master of
Business Administration. I would like to thank Ms. Joan Rajan,
asst.manager C.H. ROBINSON WORLDWIDE FREIGHT INDIA PRIVATE
LIMITED for her support during the internship period. I also articulate

my profound gratitude to Mrs. Jaya Prabha Bose , my faculty guide for

offering her unending support and extended co-operation. Lastly I
would like to thank my parents for their continued persistence and god
almighty for showering his perennial blessings on me to complete the
project.

TABLE OF CONTENTS
CHAPTER
1

TOPIC
INTRODUCTION

1.1

NEED AND IMPORTANCE OF THE STUDY

1.2

OBJECTIVES OF THE STUDY

1.3

SCOPE OF STUDY

INDUSTRY AND COMPANY PROFILE

REVIEW OF LITERATURE

RESEARCH METHODOLOGY

4.1

OBJECTIVE OF STUDY

4.2

RESEARCH PROBLEM

4.3

RESEARCH METHODS

4.4

SAMPLE SELECTION

4.5

METHOD OF DATA COLLECTION

4.6
4.7
5
6
6.1
7

STATISTICAL TOOLS
LIMITATIONS OF STUDY
DATA ANALYSIS & INTERPRETATION
FINDINGS
SUGGESTIONS
CONCLUSION
BIBLIOGRAPHY
ANNEXURE

PAGE

IMPORT AND EXPORT OPERATIONS

CHAPTER - 1
INTRODUCTION

The expanding economy and business opportunities have caused companies to export and
import products to develop their business. International shipping remains daunting for many new
or relatively inexperienced exporters, particularly small and medium-sized firms. Effective use
of transportation equipment and modes reduces shipping and logistics costs. However, export
and import planning entails all sorts of considerations, from inventory levels and manufacturing
lead times to customers' preferences and transportation options. Ocean export is generally much
cheaper than air export, but the transits from warehouse dock to consignee door are measured in
weeks instead of days.
Airfreight is suitable for perishable goods; it may also include light, high-value
commodities such as semiconductors and electronic components essential to running industry or
fulfilling an inventory shortfall and unexpected consumer demand. Ocean cargo often includes
goods such as automobiles, toys, and household appliances and items whose bulk, weight, and
steady consumer demand allow slow transportation.
A freight forwarder is an agent who arranges the transportation of goods for others. A
forwarder functions as a travel agent for cargo or a designer of logistics. Forwarding includes
booking cargo space for shippers, providing shipping documents, and sometimes arranging other
services as varied as shipment packing and cargo insurance. Many forwarding companies offer
assistance in transportation logistics, including freight consolidation, customs brokerage,
warehousing, distribution, and other value-added services. Further, they operate networks of
offices and agents for export and import. Freight forwarders are generally non-asset-based

providers, meaning that they do not own planes, ships, and other means of transport. When
forwarders book cargo space for customers, they have the flexibility to choose the best routes
and transit schedules.
Forwarders typically have service contracts with many air and ocean carriers to facilitate
economical shipping around the globe. To facilitate rate quoting and mode selection, exporters
should be prepared to answer a host of questions about these and related issues:
Commodity (description and use)
Destination (ports/cities)
Pieces, weight, dimensions
Terms of sale
Terms of payment
Number/frequency of shipments
Routing/transit requirements
Insurance requirements.
Further, when comparing different modes of transportation, these are some of the issues
to consider:
Speed
Frequency of shipments
Cost
Dependability
Capacity
Availability/accessibility
Additional/special services.

1.1 NEED AND IMPORTANCE OF STUDY

A study about the field of logistics is required to understand the terms of trade and their
operations which aides in pursuing a career in logistics as well as providing improvisations and
logical inputs to reduce the cost of freight for the clients and forwarder and increase
revenues/profits for the company.
The importance of the study stems from the fact that the expanding economy and global
business opportunities have caused companies to export and import products to develop their
business and the companies are looking out for effective use of transportation equipment and
modes to reduce shipping and logistics costs.

1.2 OBJECTIVES OF THE STUDY

To know about Logistics Industries

To compare the effectiveness of logistics management at C.H.ROBINSON and to

benchmark the organization with respect to the industry.

To have a thorough understanding of how logistics and freight industries work.

To know whether the customers are satisfied with the existing range of service pattern.

1.3 SCOPE OF THE STUDY

Focuses on global freight forwarding.

Focuses on the operations of a freight forwarded.

The scope of the study is limited to Indian import/export.

CHAPTER - 2
INDUSTRY PROFILE

Companies in this industry provide freight forwarding and customs brokerage services. Major
companies include CH Robinson, Expeditors International of Washington, UPS Supply Chain
Solutions, and UTi Worldwide. Freight forwarding and contract logistics continues to be a
growth industry, considering current economic circumstances. Even so, freight and logistics
companies will need to deal with numerous issues in the years ahead. For example, as trade
routes become more competitive and as freight rates fall, the industrys traditional bargaining
power with its shippersvolumewill be challenged. One important strategy to counter this
challenge is to use balance sheet strength to acquire niche players in important trade routes and
geographies, especially in emerging markets.
Another key to growth and profitability will be the ability to analyze customers needs
and then respond quickly with differentiated and advanced logistics solutions. That will require
better IT tools to improve internal process efficiency and to generate analyses that result in
deeper understanding of customers industries and business processes.
As customers enter new markets, especially in emerging economies, they are
demanding much more than traditional transportation and warehousing services from their
freight forwarding and contract logistics providers. The ability to offer new, value-added
services such as warranty processing, returns management and light manufacturing is now a
differentiator, as is providing services such as customs and insurance brokerage, and trade and
transportation management. In other words, the ability to become a one-stop-shop provider is
emerging as a way to achieve differentiation and capitalize on cross-segment opportunities.
Demand is rising for advanced logistics capabilities and industry-focused solutions,
especially in emerging markets. The increasing number of assembly plants in these markets
including Turkey, Mexico and Thailandhas positively affected the dynamics of the logistics
industry.

Companies are also responding to market and economic pressure by restructuring their
logistics organizationsconsolidating service providers and functions, sharing logistics
facilities and centralizing management.
A controlling presence in key growth markets and the flexibility to respond swiftly and
innovatively to customers evolving needs distinguish the high performers in freight
forwarding and contract logistics. In the future, deep expertise in customers industries and in
the discipline of cost control will be more critical than ever. High performers will differentiate
themselves further by offering supply chain management as a shared service to customers. To
drive the continuous innovation of customer-facing applications, industry leaders will leverage
IT-driven process management collaboratively with those customers.

COMPANY PROFILE
C.H.ROBINSON

Founded in 1905, C.H. Robinson is one of the world's largest third party logistics (3PL)
providers, with 2014 gross revenues of $13.5 billion. They provide freight transportation and
logistics, outsource solutions, produce sourcing, and information services to over 46,000
customers through a network of offices in North America, South America, Europe, and Asia.
To meet the freight needs of customers, they provide access to over 66,000 transportation
providers worldwide, including contract motor carriers, railroads, air freight carriers, and ocean
carriers. With the service and dedication of more than 11,500 employees, performance-driven
culture and proven track record of success, theyve built a strong reputation as an industry
leader.
While the tradition of leadership began with produce and truckload services, they've
evolved into an industry-leading 3PL with a comprehensive portfolio of sourcing,

transportation, and logistics services. The ongoing challenges of the supply chain industry
inspire the company to innovate and search for new ideas that challenge limits and extend
Beyond Brokerage. Their customers, contract carriers, and suppliers are the beneficiaries of
this forward-thinking approach, because they believe they deserve nothing but the best from
their 3PL. The company is not content to simply meet their expectationsthey are committed
to exceeding them every single day.

Mission Statement: Our people, processes, and technology improve the world's
transportation and supply chains, delivering exceptional value to our customers and suppliers.

C.H. Robinson has a Growth Strategy rather than a Vision Statement:

Key trends continue to drive growth in third party transportation, such as increased
outsourcing, adoption of core carrier programs, increased reliance on technology, and
globalization of supply chains. To capitalize on those trends and meet our growth goals, we
will continue to:
Grow our share of the North American transportation and logistics market; Add new
third-party logistics services; Develop intra-continental branch networks on other continents;
and expand our global freight forwarding network.

Services: C.H.ROBINSON provides logistic services of transportation through the

following modes 1. Road
2. Rail
3. Air
4. Ocean
As an integral part of their transportation services, they provide a wide range of value
added logistics services, such as supply chain analysis, freight consolidation, core carrier
program management, and information reporting.

ORGANISATIONAL FUNCTIONS
a) Freight Forwarding
Departments typically arrange cargo movements to an international destination.
This department has the expertise that allows them to prepare and process the
documentation and perform related activities pertaining to international shipments. A
freight forwarder organizes the safe efficient movement of goods on behalf of an exporter,
importer or another company or person, sometimes including dealing with packing and
storage. Taking into account the type of goods and the customers delivery requirements,
freight forwarder array, the best means of transport, using the services of shipping lines,
airlines or road and rail freight operators.
Functions:
i.

Researching and planning the most appropriate route for a shipment. Taking
account of the perishable or hazardous nature of the goods, cost transit time and
security.

ii.

Arranging appropriate packing. Taking account of climate, climate, terrain, weight

and nature of goods and cost, delivery or warehousing of goods at their final
destination.

iii.

Obtaining, checking and preparing documentation to meet customs, excise and

insurance requirements, packing specifications and compliance with overseas
countries regulations and fiscal regimes.

iv.

Offering consolidation services by air, sea, and road.

v.

Ensuring cost effective and secure solutions to small shippers with sufficient
cargo to utilize their own dedicated units.

vi.

Liaising with third parties to move goods by road, air or sea in accordance with
customer requirements.

vii.

Arranging insurance and assisting the client in the event of a claim.

viii.

Arranging payment of freight and other charges or collection of payment on

behalf of the client.

ix.

Transmitting data by internet and satellite systems, enabling real time tracking
and tracing of goods.

x.

Arranging charters for large volumes out of gauge or project movements by air
and sea.

xi.

Acting as broker in customs negotiations worldwide to guide the freight

efficiently through complex procedures

xii.

Arranging courier and specialist hand carry services

xiii.

Maintaining visibility and control through all phases of the journey, including
the production of management reports and statistical and unit cost analysis

xiv.

Acting as consultant in customs

xv.

Maintaining current knowledge of relevant legislation, political situations and

other factors that could affect the movement of freight

b) Logistics Field: Bulk Operations

The main function in this department includes identifying the customers and
collecting information about the amount of material to be exported, the product, place of
exports. The department also undertakes cargo booking, provides information on the rates,
the schedules, the arrival, departure time, name of the ship, transhipment details and does the
follow up.
Functions
i.

Identifying the customers by the marketing person of this department.

ii.

Convincing the shipper of the services that company provides to be better than the
other shipping service providers.

iii.

Enquire about the place or commonly referred to as the destination port to which
the shipper would like to export the cargo.

iv.

Enquire about the type and quantity of the cargo that he would like to export.

v.

The type of container and the number of containers that the shipper would like to
take.

vi.

Analyzing the rate the shipper expects from his cargo movement.

vii.

Informing the shipper the rate and negotiating with him.

viii.

Scheduling the arrival and department time of the vessel

ix.

Listing out the transhipment details and do the follow up

c) Clearing and Forwarding (C & F)

The main function of C&F department is to undertake the customs formalities on
behalf of the exporters or importers. The documentation process and clearing activities are
done by this department.
Functions
i.

Preparation of various kinds of bill of entry and shipping bill.

ii.

Arrival and clearance of vessels.

iii.

Determination of value for assessment.

iv.

Conversion of currency.

v.

Nature and description of documents to be filed with kinds of bills of entry &
shipping bill.

vi.

Procedures for assessment and payment of duties.

vii.

Examination of merchandize at the customs stations.

viii.

Prohibitions on imports and exports items.

ix.

Re-importation and conditions for free re-entry

x.

Check offences under the act

xi.

Refund procedures, appeals and revision petition

d) Network Design
A Logistics Network Design initiative is a strategic analysis of entire supply chain.
Some of the strategic questions are:

To ensure enough facilities to meet future capacity requirements?

Which facilities should be closed and/or consolidated?

Is there an opportunity to make changes to the network to reduce logistics costs?

Develop the Current Financial Model:

Before making sensible decisions on what changes to make the network, a base
case financial model needs to be developed. It should include the costs of all logistical
activities such as Warehouse costs, Transportation costs, Inventory costs and Order
Processing costs.
Software Selection:
Due to the complexity of this analysis, a network optimization software package
is in order. The software phase may be completed concurrently with the financial modelbuilding phase above. One person on the project team should be responsible for sourcing
the right software to meet the projects modeling needs.
Data Gathering & Validation:
This is one of the key drivers to a successful project. It is imperative that the data
from your current data warehouse (transactional data) be accurate. Some characteristics
of interest would be cube, weight, carton dimension, hazardous materials, etc. One of the
activities further into the project will be to create a summary of the product flows. This is
accomplished by creating family groupings of products. If the data is not clean the flows
will be misrepresented and this will affect the accuracy of the model.
Analyze Current State of Operations:
A throughput and capacity analysis should be completed for the existing
operations. This will help determine if there is additional capacity in the existing facilities

10

or if there is excess capacity available. This will help develop the scenarios later on. The
impact to the other logistical operations may then be identified.

e) Warehousing
A warehouse is a commercial building for storage of goods. Warehouses are
commonly used by manufacturers, importers, exporters, wholesalers, transport businesses,
customs, etc. They are usually large plain buildings in industrial areas of cities and towns.
They come equipped with loading docks to load and unload trucks; or sometimes are loaded
directly from railways, airports, or seaports. They also often have cranes and forklifts for
moving goods, which are usually placed on ISO standard pallets loaded into pallet racks.
Most warehouses are completely automated, with no workers working inside. The
pallets and product are moved with a system of automated conveyors and automated storage
and retrieval machines coordinated by programmable logic controllers and computers
running logistics automation software. These systems are often installed in refrigerated
warehouses where temperatures are kept very cold to keep the product from spoiling, and
also where land is expensive, as automated storage systems can use vertical space efficiently.
These high-bay storage areas are often more than 10 meters high, with some over 20 meters
high.
The direction and tracking of materials in the warehouse is coordinated by the WMS,
or Warehouse Management System, a database driven computer program. The WMS is used
by logistics personnel to improve the efficiency of the warehouse by directing pathways and
to maintain accurate inventory by recording warehouse transactions.
Modern warehouses are also used at large by exporters/manufacturers as a point of
developing retail outlets in a particular region or country. This concept reduces the end cost
of the product to the consumer and thus enhances the production sale ratio. Warehousing is
an age old concept which can be used as sharp tool by original manufacturers to reach out
directly to consumers leaving aside or bypassing importers or any other middle agencies or
person.

11

The Warehouse is to be well guarded with safety provisions to counter pilferage,

fire, floods & other calamities. The Warehouses are in convenient locations & well
connected by roads to facilitate on time delivery to customers.

f) Cross docking Containerization

Cross docking is a practice of logistics of unloading materials from an incoming semi
trailer truck and loading these materials to outbound trailers or rail cars, with little or no
storage in between. This may be done to change type of conveyance, or to sort materials
intended for different destinations or to combine material from different origin.
An increasing popular method of shipment is containerization. A container is a large
box made of durable material such as steel, aluminum, plywood and reinforced plastics. A
container varies in size material and construction. Its dimension is typically 8 foot high and 8
foot wide lengths usually varying. A container can accommodate most cargo but is most
suitable to packages of standard size and shape. Containers can take case of most of 4 main
packing problems. Because of container construction, a product does not have to have heavy
packaging, it gives protection against:
i. Breakage
ii. Moisture
iii. Temperature controlled
iv. Pilferage and Theft

There are mainly 2 types of containers

1. Dry Containers
2. Special Purpose Containers
a. Types / Size
b. 20 Foot Dry
c. 40 Foot Dry

12

d. 45 Foot Dry
3. Open top containers
4. Flat rack for over sized cargo
5. 40 foot refrigerated containers/ reefers
6. High cube containers (40 foot, 45 foot & Reefers)

BUSINESS STRATEGY
a. Demand Chain Management
Understanding demand requires a comprehensive knowledge of your customers, you
should know what products / services are demanded by your customers; how do they make
their purchases, how often they order and what constraints they face on the purchasing
process. Very few companies have mastered this concept. C.H.ROBINSON was able to
know all the above concepts through considerable focus into customer needs and grievances.

b. Achieving Competitiveness in Logistics, Freight, Supply Chain

13

Reduced lead time, inventories, lower operating costs, product availability and
customer satisfaction are the benefits which grow out of effective logistics and supply chain
management. The decisions usually carried on by C.H.ROBINSON, cover both the long term
and short term. Strategic decisions deal with the corporate policies, and look at overall design
and logistic chain structure. Tactical, Operational decisions are those dealing with everyday
activities and problems of the organization. Change is the inevitable factor for each and every
day situation within and outside the organization. The decisions must take into account the
strategic decisions already in place. Therefore organization must structure the logistics ideas
through long term analysis and at the same time focus on every time situations. Furthermore,
market demands, customer needs, transport considerations and pricing constraints are the
factors in order to structure the logistics, freight. C.H.ROBINSON realized the fact and is
prepared to face any unexpected situations like inflation/ deflation in the economy, price
factors, climatic problems etc.

c. Operational Fleet Routing & Loading

The organization derives routes in transportation are mainly long-haul (Optimization).
For short haul deliveries, there are ready solutions that are tightly integrated to warehouse
management systems (outsourced facility), to efficiently route fleets of vehicles and vessels
and plan picking and loading. Stipulated time windows for pick-ups and deliveries and
vehicular weight and spatial capacities would be used, as will constraints such as delivery
within specified period minutes upon pickup (useful for perishable goods). Time required at
various stops - in terms of fixed time to park and variable time dependent on amount to be
loaded or off-loaded - can be specified. Travel speeds along various types/zones of roads can
be stipulated by traffic information services. The organization schedules arrival and departure
times for each stop can thus be worked out quite accurately. Routes can be generated
dynamically and ad hoc backhaul or other opportunities can also be assigned to the most
suitable vehicle. The benefits of operational fleet routing include considerable reduction in
fleet operating cost and improved customer service with better estimated arrival time.

14

d. Vendor Managed Inventory

Vendor managed inventory, coordinated by an integrated logistics system, allows
inventory to be optimized together with transportation. C.H.ROBINSON try to know the
product value as well as storage capacity (mainly warehouse how much to outsource). As a
routine job the company collects information on consumption rate, current inventory levels,
forecasted demand and status of shipments. Thus the system can optimize the right quantities
of replenishments to be sent at the right time to ensure that service levels are maintained
while minimizing cost of inventory and transportation.

e. Mode of Transportation
Transportation generally is movement of product, goods, raw materials to different
stages in supply chain. Essentially in supply chain logistics plays a major role, the manner in
which product is moved from one location to another is through road, rail, truck, air, sea.
C.H.ROBINSON essentially uses only 2 modes for their operation they are air and
sea. The goods being delivered to end customer is brought to port or to the place through
containers or other methods like wagons, or cold enclosures like frozen storage.
C.H.ROBINSON strategically manages the procurement, movement, and storage of
materials, parts and finished inventory through the organization and its marketing channels.
Essentially from companies angle, there are two categories, initially inbound logistics, i.e.,
handling goods that are brought into the company, through road transport and storing and
making them available. Another main phase is the outbound logistics, taking the cargo or the
goods through channels, and is being done with considerable effort to various parts of the
world as per the customer requirements.
i.

Intermodal Transportation System: This is the use of one or more than one mode
of transport to move a shipment to its destination. C.H.ROBINSON uses this in an
efficient way. Variety used is road and sea in the case of organization. Referring to
Global trade, this is the only option as factories and markets may not be next to

15

ports. It helps reduce cost in operation. Helps reduce cost that cannot be matched
by single mode. Essentially it is very convenient for shippers as well as
consignee.

ii.

Attributes: The price charged is reasonable with regard to the consignee, as

organization has got a long term relation with all the customers. Usually goods
being transported are electronics and frozen stocks from warehouse. The relevant
focus is on warehouse, transportations services offered. Service is another aspect
which focuses the advanced need of the customer, initially with proper timing
maintenance, order management. As the consignee is offered service by 3PL like
C.H.ROBINSON with favorable order management, and ease of doing business is
attained by logistics organization like C.H.ROBINSON.

f. The Challenge Faced by Organizations

In todays world, competence is taking on new dimensions. The ability to compete is
being determined by the degree of responsiveness to customers and key issues handling. How
fast you deliver the goods/ products, what the price paid by customers and what value
customer is getting throughout the service is considered in a schematic and ordered way.
Markets are quick demanding and customization of each logistics activities is essential for
each customer, and has become the essential factor in logistics management.
C.H.ROBINSON faces lot of ups and downs in each operation and improves
operation on each situation while dealing with each customer. C.H.ROBINSON dominant
improvement methods used are:
i.

What are the customer expectations?

ii.

How are your competitors performing in each aspect of operations?

iii.

Determining the gaps in each phase and try to fill it.

16

g. Economic Ordering Quantity (EOQ)

Efficient order quantities consider the Purchase Order Cost (POC), the Annual
Demand rate (AD), the Inventory Carrying Rate (ICR), and Unit Inventory Volume (UIV).
Large Order Quantities yield high inventory levels and high inventory carrying costs but
fewer orders and lower ordering costs. High ordering costs and demand rates suggest large
order quantities. High ICRs and high unit inventory values suggest small order quantities.
Generally during research the analysis shows, few organizations believe EOQ
analysis is outdated and quite few with enhanced focus on it. There is relevant need for EOQ
in this era. EOQ analysis should be completed as a part of any inventory strategy. The
analysis suggests appropriate reordering intervals for all items each organization is handling.
Competitors focus on reducing the costs of placing purchase orders. The lower the purchase
order cost, the more economical it becomes to order in small increments and the less
inventory will be there in the system. The purchase order costs is typically dominated by the
labor and paperwork costs of planning, negotiating, executing and tracking purchase orders.
Large number of organization extent to which these functions can be automated via
automated purchase order planning, e-procurement, online catalogs, online bidding and
online exchanges, is the extent to which inventory levels and lost sales costs may be reduced
in the supply chain and there to the efficiency of logistic operations. C.H.ROBINSON has a
considerable drawback in this scenario comparing to the other firms. Cost is high in this
situation for ordering costs to the firm.
Studies on Inventory, Back Order, Lost Sales, Stock Outs, Packaging and Packaging
Materials, Documentation from C.H.ROBINSON
1. Inventory

17

Inventory is a list for goods and materials, or those goods and materials
themselves, held available in stock by a business. Inventory are held in order to
manage and hide from the customer the fact that manufacture/supply delay is longer
than delivery delay, and also to ease the effect of imperfections in the manufacturing
process that lower production efficiencies if production capacity stands idle for lack
of materials.
There are three basic reasons for keeping an inventory:
a)

Time - The time lags present in the supply chain, from supplier to user at
every stage, requires that you maintain certain amount of inventory to use
in this "lead time"

b)

Uncertainty - Inventories are maintained as buffers to meet uncertainties

in demand, supply and movements of goods.

c)

Economies of scale - Ideal condition of "one unit at a time at a place

where user needs it, when he needs it" principle tends to incur lots of
costs in terms of logistics. So Bulk buying, movement and storing brings
in economies of scale, thus inventory.
[The Management of Business Logistics, Coyle, Bardi, Langley]

2. Back Order
A company having to back order an item that is out of stock will incur
expenses for special order processing and transportation. The extra order processing
traces the back orders movement, in addition to the normal processing for regular
replenishments. The customer usually incurs extra transportation charges because a
back order is typically a smaller shipment and often incurs higher rates. The seller
may need to ship the back ordered item a longer distance. The seller may need to ship
the back order by a faster and more expensive means of transportation. We could
estimate the back order cost by analyzing the additional order processing and
additional transportation expense. If customers always back ordered out of stock
items, the seller could use this analysis to estimate the cost of stock outs. The seller
could then compare this cost with the cost of carrying excess inventory.
[The Management of Business Logistics, Coyle, Bardi, Langley]

18

3. Lost Sales
Most companies have competitors who produce substitute products, and when
one source does not have an item available, the customer will order from another
source. In such cases the stock out has caused a lost sale. The sellers direct loss is the
loss of profit on the item that was unavailable when the customer wanted it. Thus, a
seller can determine the direct loss by calculating profit on one item and multiplying
it by the number the customer ordered.
E.g.: If the order was 100 units and the profit is 10$, the loss is 1000$. If the
effort is made by a sales man and if the effort is wasted and in that sense it is an
opportunity loss. Whether including such a cost is valid would depend upon whether
the company uses sales people in its marketing effort.
Another aspect is determining the amount of a lost sale may be different and
difficult in certain circumstances. Numerous companies customarily take orders by
telephone. A customer may initially just enquire about items availability without
specifying how much is desired. If an item is out of stock, the customer may never
indicate a quantity and the seller will not know the amount of the loss.
4. Stock out
Cost incurred to a firm when current inventory is exhausted for one or more
items. Lost sales revenue costs are incurred when the firm is unable to meet current
orders because of a stock out condition.
5. Packaging and Packaging Materials
Mainly this is a main division in warehouses. Packaging interacts with the
logistics system in number of different and important ways. The size of and
protection afforded by the package affect the type of materials handling equipment
used and the level of product damage incurred. The package has an impact on the
stacking height of the product in the warehouse and thereby on the utilization and cost
of the warehouse. Packaging is quite important for effective damage protection, not

19

only in the warehouse but also during transportation. Packaging may contribute
nothing to a products value but its influence on logistics costs is considerable.
Packaging size may affect a companys ability to use pallets or shelving or
different types of materials handling equipment. Many companies design packages
that are too wide or too high for efficient use of either a warehouse or transportation
carrier. So, coordinating packaging with warehousing and with transportation is quite
important. We need to note, poor packaging can contribute to higher handling charges
and result in lower future sales if the goods arrived damaged.
Two types of packing exist: consumer packaging and industrial packaging.
Consumer packaging provides information important in selling the product. I.e.
giving the product most visibility when it comes with others on the retail shelf. On the
other hand industrial packaging is of primary concern to the logistics. The packaging
protects goods that a company will move to store in the warehouse and also permits
the company the effective use of transportation vehicle space.
Materials generally used in previous years was wood and other harder
materials for no breakage, but it added considerable shipping weight to the transport
and it further increased transportation cost. Generally new era has come up with
efficient packaging materials, organization nowadays use most cost effective
packaging with focus on security and minimizing cost. Cushioning materials protect
the product from shock, vibration, and surface damage during handling. Cushioning
materials include shrink wrap, air bubble cushioning, cellulose wadding, and plastics.
Companies often use shrink wrap for consumer packaged goods. Packaging also
helped reduce pilferage and product tampering in warehouse and during transport. Air
bubble cushioning is made of plastic sheets that contain air pockets. There are other
factors while considering packaging they are environmental protection. They are
considered in situations of perishable items like food and drugs.

20

CHAPTER - 3
REVIEW OF LITERATURE
THIRD PARTY LOGISTICS PRACTICES : AN INDIAN PERSPECTIVE
Third party logistics (3PL) is a business dynamic of growing importance all over the
world. However, it is at a very nascent stage in India, though some domestic and multinational
companies are trying to establish themselves in this sector. This paper is an attempt to provide a
3PL perspective in India. The paper focuses on three major issues present extent of usage of
third party logistics services, reasons for outsourcing and impact of usage of third party logistics
services on business results. The paper reveals that most 3PL users are satisfied with the current
level of services provided by 3PL service providers as it has led to a positive impact on business
results. As a result, the usage of third party logistics services is likely to increase substantially
(40 percent) in the future.
[B. S. Sahay and Ramneesh Mohan]

SUSTAINABLE LOGISTICS: A LITERATURE REVIEW AND EXPLORATORY

STUDY OF IRISH BASED MANUFACTURING ORGANISATIONS
There is growing evidence that the influence of environmental performance as a decision
criteria in the consumption of products/ services for consumers is growing. Its in the logistic
operations where most organizations can implement green supply chain strategies. This paper
presents a comprehensive literature review charting the evolution of logistics operations as it
increasingly includes modern environmental concerns. Building on this the paper also presents
the results of an exploratory face to face survey that was conducted to analyse attitudes to,
knowledge of and preparedness among sellers but more extensively buyers of logistics services
to implement sustainable logistics in Ireland. The paper shows that there is a varying degree of

21

willingness among logistic buying organizations to implement practices to address the

environmental impact of their activities. The results show that although the majority of these
organizations are willing to some extent, this is not universal, with a significant proportion of
organizations believing that there are hidden costs and risks associated with the implementation
of sustainable logistics.
[P.J. Byrne, , Paul Ryan , Cathal Heavey]
DCU Business School, Dublin City University ,
University of Limerick, Limerick, Ireland.

PERFORMANCE INDICATORS IN LOGISTICS SERVICE PROVISION AND

WAREHOUSE MANAGEMENT A LITERATURE REVIEW AND FRAMEWORK

With the ever increasing focus on cost reduction, product leadership and customer
intimacy, the need for Supply Chain Management practices rises across many industries. Over
the last two decades Logistics Service Providers have become important players in many chains
and industries. New challenges arise due to the emergence of technologies. Data and information
can be found anywhere, however, to make the proper decisions we need to have an insight in
how decisions should be made, and what is important for the company and what not. In order to
do so we sollicited the Key Performance Indicator (KPI) literature -focussing on the areas of
general management, supply chain management, logistics service provision and warehousing. In
our earlier work we proposed a KPI framework that we here revisit and validate in the
Warehousing domain through the means of expert interviews.
[Elfriede Krauth ,Hans Moonen ,Viara Popova, Martijn Schut]
RSM Erasmus Universiteit, Department of Management of
Technology and Innovation,
Department of Computer Science, Faculty of Sciences Vrije
22

Universiteit Amsterdam.

CHAPTER - 4
RESEARCH METHODOLOGY

5.1 OBJECTIVE OF STUDY

To compare the effectiveness of logistics management at C.H.ROBINSON and to bench

mark the organization with respect to the industry.

To have a thorough understanding of how logistics and freight industries work.

To identify the drivers behind Logistics and Freight.

5.2 RESEARCH PROBLEM

The need for the study was to assess the effectiveness of Logistics Management in
C.H.ROBINSON compared with other organization in the same industry. The organization also
needs relevant data as to how it can improve its management policies in order to gain future
market share.

5.3 RESEARCH METHODS

The type of research is analytical. Data regarding the division of logistics management such as
Freight, Warehousing, Cross docking, Network Design etc. in which C.H.ROBINSON are at
present in business were collected from other similar firms in the industry. The indicators
selected are ease of service, client handling, customer service, website information, employee

23

efficiency in general. Other indicators for the freight and warehouse divisions are lead-time,
inventory management, product availability; time elapsed in transit, operating cost and customer
satisfaction. The collected data was analyzed and performance of C.H.ROBINSON was
evaluated. As to my study I believe I have selected the right mix of techniques for the
comprehensive approach, which can be suited well for the organization.

5.4 SAMPLE SELECTION

Convenience sampling is used for study, as I am interested here in getting an inexpensive
approximation of the truth. Operations of C.H.ROBINSON WORLDWIDE FREIGHT INDIA
PRIVATE LIMITED, Chennai has been acquired. Similarly, 100 organizations having major
operations in the Freight and Logistics have been selected as sample for the survey. The selection
was based on the sampling said above.

5.5 METHOD OF DATA COLLECTION

Primary Data: The major tool used was interview with managers and staff of the branch office,
questionnaire was developed focusing various aspect.
Secondary Data: Books of Logistics Management for literature reference, Internet Web Portals,
Websites of each firm, Company Brochures.

5.6 STATISTICAL TOOLS

Percentage Analysis
Bar Diagrams
Pie Charts

24

5.7 LIMITATIONS OF STUDY

A few organizations did not publish the exact values for each question especially in sales
turnover and other similar figures.

The study was conducted in Chennai only and confined to the freight division of the
logistics management.

Certain monetary values were not being filled by organizations.

Due to organizations security reasons documents like Bills, Warehouse Bills, etc could
not be gained.

25

CHAPTER - 5
DATA ANALYSIS AND INTERPRETATION

The data collected through the questionnaire are analyzed to know about the respondents
opinions about various particulars asked in the questionnaire. The data collected from the
questionnaire was entered into spread sheet and the data has been interpreted. The questionnaire
comprises of fourteen questions with subparts for each.
The topics covered are with decisions of each operational area, employee numbers of each firm,
profitable area in operation, catering location, service offering, organizational effectiveness,
inventory, location, product availability and customer satisfaction.

1) Which are the logistics services organizations offers?

Table -1 Service Offer
Sl. No.
1
2
3
4
5

Service
Freight
Warehousing
Cross docking
Network Design
Value Adding

Percentage
100
89
88
66
98

26

Chart-1 Service Offer

Valuse Adding; 98

Freight

Network Design; 66
Warehousing Crossdocking

Freight; 100

Warehousing;
Network
Design89 Valuse Adding

Crossdocking; 88

The pie chart above shows the service offer of each organization. The chart shows that 100%
of the respondents provide freight service and almost 90% provide Warehousing and Cross
docking. Only 66% were providing service of Network Design. Other service includes value
adding, which represents 98% of the sample. It includes packaging, labeling etc.

2) Operating with other logistical providers and reasons for decisions.

Table -2 Operate With Logistical Providers
Sr. No.
1
2
3
4

Decisions
Operational Stability
Cost Effectiveness
Customer Needs
Other

Percentage
11
10
36
96

27

Chart-2 Operate With Logistical Providers

11 10
36

96

Operational Stability
Cost Effectiveness
Customer Needs
Other

The pie chart above shows the operational decisions and reasons for operations with other
logistical providers. The chart shows that 96% of the respondents operate with other service
providers for different reasons like coordination, clearance, bulk operations etc. Almost 36%
have operations with other providers as per customer needs. Only 11% and 10 % were
providing service along with other providers for the purpose of operational stability and cost
effectiveness respectively. It is stated that 96% of organizations operate with other logistical
providers and remaining 4% as standalone.

3) What is the mode of decisions regarding the operations?

Table-3 Mode of Decision
Sl.

Operational Decision

Percentage

No
.
1

Strategic

37

28

2
3

Tactical
Operational

88
63

Chart-3 Mode of Decision

37

63

Strategic
88

Tactical
Operational

The pie chart above shows the mode of decisions regarding the operations. The pie chart shows
88% of organizations take tactical decisions followed by 63% with operational decisions and
37% strategic decisions. Most of the organizations have a mixture of all the decisions in their day
to day as well as in long and short term plans.

4) Which is the area of the activity, that organizations feel best in their service?
Table-4 Best Activity
Sl. No.
1
2
3
4
5

Service
Freight
Warehousing
Cross docking
Network Design
Value Adding

Percentage
98
86
87
4
97

29

Chart -4 Best Activity

97

98

87

86

Freight
Warehousing
Crossdocking
Network Design
Other

The pie chart above shows the best activity which organization feels in their operations. The pie
chart shows 98% of organizations have freight in the predominant area, followed by 86% of
warehousing. Another significant area is Cross docking with 87% as best activity. There is only a
minor activity based on network design with 4% in pie graph. Most of the organizations have a
mixture of all the activities in their day to day and 97% of organization says other activities bring
in more revenue and the best of their activities, which includes packaging, labeling etc.

5) Number of employees in each type of the service rendered of the organizations

Table-5i Employees
Sl.

Departments In Organizations

No
.
1
2
3
4
5
6

Number of

Percentage

People in Each
Top Management
Operations
Accounts / Finance
Marketing
Human Resource
Documentation /Others

452
468
451
517
371
1847

11
11
11
13
09
45

30

Table- 5ii Employees in CH Robinson

Sl.
No.
1
2
3
4
5
6

CH Robinson : Departments
Top Management
Operations
Accounts / Finance
Marketing
Human Resource
Documentation /Others

Number of

Percentage

People
3
4
4
3
0
8

14
18
18
14
0
36

Table-5iii Employees % of both.

Docu
Top
Manag
ement

Operatio

Acc./Finan Marketin

ns

ce

ment
HR

ation/
Other
s

C.H.ROBINSON
Employees
Percentage
Other

14

18

18

14

36

11

11

11

13

45

Organization
Employees %

Chart 5iii Employees % of both

31

50
45
40
35
30
25
20
15
10
5
0

CH Robinson
Other

The line charts above shows the comparison of employees in each functional division of
organization with C.H.ROBINSON. The line chart shows around 14 percentages of people
belong to top management and industry standards has 11 percent, followed by 18% for
operations and industry standards has 11%. Human Resource has to be enhanced and need to be
further improved or need to start in the organization. Documentation also needs to be further
strengthened. Marketing comprises of 14% working in the said area. Most of the organizations
have a mixture of top management with marketing in their activities and functional area. Human
Resource comprises of 371 people and other main area is documentation and workers in the
areas of loading, operational area. This comprises of only 36% and industry standards are of
45%.

6) What are the locations to which the company caters to?

32

Table- 6i Catering Locations

Sl. No.
1
2
3
4
5
6
7
8

Catering Locations
Asia
Europe
USA
Australia
Africa
Russia
Middle East
Other

Percentage
100
6
89
86
71
98
98
90

Table 6ii Catering Locations

Asia

Europe USA

Australi

Africa

Russia

ME

Other

a
CH Robinson
Other

100

89

100

100

79

92

82

93

Organizations

100

89

86

71

98

98

90

Chart 6ii Catering Locations

120
100
80
60
40

CH Robinson
Other

20
0

The pie chart above shows each organizations catering location in the world. The chart shows
100% of organizations cater to Asian region followed by 6% to Europe and 89 % to USA. Each
organization has tremendous catering locations with 86% to Australia, 71% to Africa, 98% to
Russia, 98% to Middle East, and 90 % to other locations. Locations mentioned as other is

33

company catering frequently with repeat orders of customers. Chart 6ii shows C.H.ROBINSON
can enter African markets and other favorable market is the middle-east. This can be looked into
very seriously in future business.

7) Which division of logistical activity earns the maximum rate of profit for each
organization on a scale of 1-10 and overall profit of each organization?

Table-7i -Maximum Rate of Profit

Profit Scale (1 - 10)

Freight

CH Robinson
Industrial Average

9
7

Warehou Cross

Network

Othe

sing

Design
6
5

8
6.41

docking
7
5

7
6

Chart-7i - Maximum Rate of Profit

10
9
8
7
6
5
4
3
2
1
0

CH Robinson
Industry Average

Table-7ii Profit of Organization (All Services Combined)

Profit Level in Percentage

CH Robinson
17.21

Industry Standards
15.39

Chart -7ii Profit of Organization (All Services Combined)

34

Profit
17.5
17
16.5
Profit

16
15.5
15
14.5
14
CH Robinson

Industry Average

The bar chart shows each organizations maximum rate of profit in each area on scale of 1-10,
where 1 denotes least profit and 10 denotes the service that fetches excellent profit. The chart
shows CH Robinson has ample amount of profit in Freight area followed by Warehousing , Cross
docking and other value adding activities with 9 , 8 and 7 each in scale. The chart 7i shows
industry average value for all the services and it is inferred that freight is giving ample amount of
profit and all other services are well above the industry standards. The chart 7ii shows profit
percentages said by each organization. We can infer that overall profit percentage for CH
Robinson is 1.82 percentage higher compared to industry average. The organization should
sustain its strategies and operations to stay above the industry mark.

8) Comparison of service offered by CH Robinson and rating of other organization in

the industry on a scale of 0- 4.
Table-8 Service Comparison (Scale 0-4)
Ease of

Client

Customer

Website

Employee

35

CH Robinson
Industry Average

Service

Handling

Service

3
3.84

4
3.76

4
3.82

Efficiency
2
3.29

3
3.83

Chart - 8 Service Comparison (Scale 0-4)

4.5
4
3.5
3
2.5
2
1.5
1
0.5
0

CH Robinson
Industry Average

The chart shows Ease of Service is not up to the mark, it shows only 3 for CH Robinson and
the industry standards is 3.84. So organization can increase their Ease of Service. Client
handling and Website ease are satisfactory compared with industry standards. Customer
service also has remarkable value compared with industry. Employee efficiency is not up to
the mark, it shows only 3 for CH Robinson and the industry standards are 3.83. It can be
brought up with a considerable effort by proper handling of human activities by Human
Resource Department.
9) What is the significant lead-time for each service rendered with previous years
data of each organization?
Table 9 Lead Time in Days
LEAD TIME IN

Freight LT

Warehou

Cross

Network

Other

36

DAYS(LT)
CH Robinson
Industry Average

21
23

sing LT

docking

Design LT

LT

20
22

LT
30
24

0
10

21
24

Chart 9 Lead Time in Days

35
30
25
20
15
CH Robinson

10

Industry Average

5
0

The above chart shows the service executed last year in logistics area and the significant leadtime of each area. The chart shows 4122 numbers of freight service jobs has been executed with
average lead-time of 21 days. Similarly warehousing jobs with 224 and lead-time of 22 days.
While comparing with industry standards Freight is dominating and similarly the main lucrative
area is other (Packaging, Labeling etc.), which has 833 in number and 21 days lead-time.
Organizations lead-time is excellent except for Cross docking. Focus should be to reduce leadtime and increase more service.

10) Average elapsed time between order receiving and delivery of the service
(Inventory).
Table-10 Elapsed Time
CH Robinson

Industry Standards

37

Elapsed Time

6.9

Chart- 10 Elapsed Time

Elapsed time
8
7
6
5

Elapsed time

4
3
2
1
0
CH Robinson

Industry Average

The above chart shows the physical verification check and average elapsed time between order
receiving and delivery of the service. The chart shows 89% of organizations have physical
verification. Average elapsed time between order receiving and delivery of service has an
average of 6.9 days. The total value of elapsed time is 613 days for 89 organizations, hence the
average days are 6.9 as explained in the figure for Industry average. CH Robinson elapsed time
is remarkable compared to industry standards.

11) Were there any shortage/ excess of stocks noted, in the last verification done?
Table -11i Inventory Shortage
Inventory Short

CH Robinson
12

Industry
19.8

38

Chart-11i Inventory Shortage

Inventory Shortage
25
20

Inventory
Shortage

15
10
5
0
CH Robinson

Industry Average

Table- 11ii Inventory Excess

Inventory Excess

CH Robinson
1.7

Industry
4.8

Chart-11ii Inventory Excess

Inventory Excess
6
5
4
3
2
1
0

Inventory Excess

The above charts show the Inventory Excess and Shortage faced by organization during
verification. It is evident that shortage faced by CH Robinson is less compared to industry
standards; there is a difference of 8. Another aspect is regarding the excess of inventory; in this
scenario, CH Robinson has a satisfactory lead with comparison to industry.
12) Average number of customer complaints generated and industry average.

39

Table- 14 Complaints
Complaints Generated Last

CH Robinson
153

Industry Average
179

Year
Chart 14 Complaints

Complaints
185
180
175
170

Complaints

165
160
155
150
145
140
CH Robinson

Industry Average

The above chart shows average number of complaints. The complaints for CH Robinson is 153
and whereas to industry average is around 180 in number. Hence organization should try to
maintain or further reduce the complaints arising. This can be achieved by increasing new
modern methods and facilities to customers. Organizations need to heavily focus onto the issue
to reduce number of complaints arising in operations, customer satisfaction and other similar
areas.
13) How does the organization follow up to retain customers.
Table-13 Customer Retention
Sl. No.
1
2
3

Service
Customer Complaints given preference
Phone
Service Intimation

Rating
100
100
100

40

4
5
6
7

Gifts
Email
Fax
Other

3
100
11
100
Chart-13 Customer Retention

100

100

Rating

100

100
90
80
70
60
50
40
30
20
10
0

100

100

11

Rating

The above chart shows preference of complaints and how organization follow up to retain
customers. Its been noted that cent percent of organization follow up with customers for
customer complaints. Most of the preferable methods for contacting customers for new service
intimation and customer realtionship are telephone, email and other methods like marketing /
sales, customer office visit with 100 rating. The least preferred are gifts and fax with 3 and 11 in
rating.
14) Does the organization has proper system for handling customer handling, and does
customer know whom to contact when a problem arises, ascertain the level of
satisfaction, feedback by customer and is customer suggestion given preference in
the organization?
Table- 14 Proper System
No.

Service

Rating

41

Proper System

100

2
3
4
5

Customer Know
Contact Whom
Customer Feedback
Customer Suggestion

100
94
88
83

Chart-14 Proper System

Rating
100
80
60
40
20
0

Rating

The above chart shows all organization in sample has propers system for handling customer
complaints. Its been revealed that 100% from sample, customers know the sytem of handling
customer complaints in the firm. Whom to contact in case of complaints is having rating of 94.
Customer feedback and customer suggestion is having rating of 88 and 83 respectively.

42

CHAPTER - 6
FINDINGS
i)

The quality of service as rated is above average in the case of CH

Robinson compared to industry. But the organization should continuously try to
improve the quality aspect as is being done by other players in the field. This is
quite a necessity as otherwise the figures may fall down. Continuous
improvement is a must so that the customers will prefer CH Robinson as their first
choice in Logistics and Freight industry category. This can be achieved with more
modern equipments and proper guidance to employees and the rating can go high
to excellent service.

ii)

Pricing of service is satisfactory, which organization can further enhance with

proper management. Present employee strength is satisfactory compared to other
organization but more focus should be made to human resources and
documentation areas where the firm has lesser employees compared to other
organizations.

iii)

Network Design is an area that the organization should not start

immediately due to low rate of returns is recorded as the industrial average.
Design of new warehouse areas and proper allocation of work with more
sophisticated software facility can be done through outsourced way during
implementation.

iv)

Decision making is excellent for organization with respect to other

organization in the industry.

v)

Operation with other logistical providers should be given more

preference to achieve cost effectiveness.

43

vi)

The organization client handling, website management and customer

service is having remarkable difference from the industry standards. The main
focus need to be on the ease of service and employee efficiency. From the data we
can infer that areas which need to be improved are Website and employee
efficiency. Employee efficiency can be improved with a proper Human Resource
department.

vii)

Service offer presently has good impact with other organizations

service offers. The remarkable areas are Freight, warehousing, and Value Adding.
Company can further enhance operations of cross docking and network design
through proper methods.

viii)

As logistics industry is concerned Freight is the dominant service

followed by Warehousing and Cross-Docking. Another important area where
organizations feel very lucrative is Value Adding .

ix)

It is observed that most of the organizations operate with other

logistical providers. 96% of organizations are doing it and remaining 4%
organizations stays independent. It is inferred that for efficient logistical activity,
support from other organizations is essential.

x)

Tactical decisions are mostly followed by organizations followed by

operational and a few strategically.

xi)

Freight and Value Adding is considered to be the best service which

organizations offer in industry. Another major observation is about Network
Design, it has low value and no organization feels it to be lucrative area in
industry.
44

xii)

Organization can enhance operations to African areas and another

major favorable area is the middle-east. From data, CH Robinson can get good
market share if they cater to African regions.

xiii)

Organization profit is above the industry standards in all areas of

service. It shows a difference of 1.82 points from industry standards.

xiv)

From the observation 89 organizations have inventory verification.

The lowest observed days for elapsed time for CH Robinson are 3 days and
industry standards with 6.9 days. Hence it is a remarkable value for CH Robinson.

xv)

In the sample taken only a few organizations has inventory short and
excess. Values are 119 and 29 for shortage and excess. CH Robinson had
shortage, but no excess in inventory and while comparing with industry CH
Robinson have remarkable value.

xvi)

The efficient methods for retaining customers are Phone, Email, Sales
Agents and least preferred methods are Fax and Gifts.

6.1 SUGGESTIONS
i)

Organization can further strenghten the employee strength in the documentation

and HR department. This can lead to further rapidity for operations.

ii)

Organization can initiate Human Resource Department to further enhance

employee motivation. This will have favourable impact for the operational as well
as total strenghtening of organization

iii)

Decision making is quite effective and can be followed for future operations
45

iv)

Operations with other logistical providers need to be enhanced further for

operational effectiveness, more focus should be given to customer delight and
cost effectiveness.

v)

Quality of service can be further enhanced to increase customer delight.

vi)

Client handling and service need to be followed in the same way and can be
further enhanced with more support. This can be achieved by proper guiding of
employees and other workers in the logistical area

vii)

CH Robinson can enter other markets in the Middle East especially to Saudi
Arabia where the potential of market is very high for Logistics industries and can
even diversify to other areas in logistics.

CHAPTER 7
46

CONCLUSION

The universe everyday is witnessing unimaginable growth in majority of the industries.

The logistics and freight industry is one such industry that is rapidly growing. Worldwide
logistics industry is distinguished by fast technological advances and is growing rapidly
than most other industries over the past years. With stiff competition around, the
company is likely to reduce the profitability but with proper management of operations
and by proper customer desired services, and also effectively utilizing its alliances it can
maintain and improve the performance. Joint operational ventures for developing the
customized services for its steady growth. The organization has enormous opportunities
to grow beyond the expectations.
CH Robinson has come a long way from being just a service provider. The
organization now has the value of being an ultimate service provider for Freight,
Transportation, Cross-docking and Value Adding as per customer needs. The present
scenario and the future of the organization with regard to the management are
satisfactory. The organization can increase the market share by improving with more state
of art technology. The organization can diversify into related other business areas like
Warehouses for lease to other organizations, state of art technology providers for other
organizations. More importance is to be given for HR development by having a separate
department for it. With the development of such a department, several favorable impacts
such as increase in output per employee, increased loyalty, team spirit etc can be
generated.
As far as CH Robinson is concerned it can be stated that through its excellent service
and aggressive logistics service, organization has shown a noticeable increase in the
market share. However, there are some areas where the company is not at the top-most
position but it can certainly gear up in the near future and is committed to acquire that
spot. On implementation of the above recommendations, the management can lead CH
Robinson to the top most position when bench marked in the coming years.

BIBLIOGRAPHY

47

Reference:
a) Logistical Management Tata McGraw 2000 Edition.
Written by Donald. Bowersox, and David. Closs.
b) The Management of Business Logistics 7th Edition:
Written by Edward J. Bardi, C.John Langley, and John Joseph Coyle
c) Logistics and Supply Chain Management: Creating Value - Adding Networks
Written by Martin Christopher.
Websites:
i)

http://www.idsc.com.sg/images/service_logistics_img1.jpg

ii)

http://www.indexuae.com/Top/Business_and_Economy/Services/Logistics

iii)

http://www.chrobinson.com/

iv)

http://www. shipping.net/C-H-Robinson.html

ANNEXURE

48

Logistics Survey
-----------------------------------------------------------------------------------------------------------Details of the Organization
Name: ___________________________________________________
Location:_________________________________________________
How long are you there in Business? _____________ Years
-----------------------------------------------------------------------------------------------------------

1) Which are the various Logistics Services you offer?

Freight

Warehousing

Network Design

Cross docking

Other Value Adding Services if any

2) Number of employees in each type of the service rendered

S
l.
N

Divisions /

Number of Employees in your various

logistics division

Functional area
Freight

o.
1

Top Management

Operations

Accounts/Finance

Marketing/Sales

Human Resources

Others if any

Total

Warehou

Network

Cross

sing

Design

docking

Other

49

3) Which is the area of activity; you feel you are the best?

Freight

Warehousing

Network Design

Cross docking

Other Value Adding Services if any

4) Which division of logistical activity earns the maximum rate of profit?

Rate them on Scale of 10

(Best 10 Average 5 Worst 0)
Freight
Warehousing
Cross docking
Network Design
Any Other
(specify)___________

5) What are the locations to which your company caters to?

i) Asia

ii) Europe

iii) USA

vii) Within Middle East only

iv) Australia

v) Africa

vi)Russia

viii) State if any other location specialization

6) Please rate the service offered by your organization

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Excellent

Good

Fair

Poor

Very Poor

Ease of Service
Client handling
Customer Service
Website Information
Employee Efficiency

7)

What is significant lead time in days for each consignment and Number of
service executed last year. (Kindly mention with previous years data)
i)Number of

ii.) Number of transport

Service Executed

orders that have been

in last year (2007)

executed, such that the

delivery is on time as
per the agreed lead

Service

time?

Freight
Warehousing
Cross docking
Network Design
Value Adding

8) What is the average elapsed time between the time of receiving order from the
customer to your firm to release the item from the ware house and the time the
item is ready for moving from the ware house with proper documentation.
________________________ Days
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9) Were there any shortage / excess of stocks noted, in the last verification done?

No shortage / excess of stocks noted

Shortage of stocks noted

Excess of stocks noted

10) Is customer complaints given preference in organization:

Yes / No

11 ) How your organization follow up to retain the customers

(Put Number 1 on desired column)

No.

Method

Phone Call

New Service Intimation to Customers

Gifts

Email

Fax

Other methods if any ________________

Number

12) What is the total number of customer complaints received in each division last
year?
______________Number
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12) Do you have a proper system of handling customer complaints?

Yes / No

13) Do you have a system of contacting customers after completing all the
formalities of an order, to enquire whether they have any complaint and to
ascertain the level of satisfaction the customer enjoyed?
Yes / No

14) What is the number of customers you had business last year?
_________________ Numbers

15) Out of the above how many are there who availed your services repeatedly?
_________________ Numbers

16) How many of them avail same services from others (your competitors) as well
_________________ Numbers

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