port cost as a component of total supply chain cost
TRANSCRIPT
TRANSPORT FORUM
DURBAN
Port Cost As A Component Of Total Supply Chain Cost
Brenda Horne – SASTALC CEO
3 SEPTEMBER 2015
Strive to aggregate inclusive, innovative, collaborative public private, stakeholder advocacy and cooperation across all
modes of transport Transport is a crucial link in the total supply chain
CLORCHEM - NCP COLUMBUS STAINLESS PTY LTD DIVINE MERCY TRADING
EVRAZ HIGHVELD EXXARO FRUIT SA - MZANZI
GLENCOR - XSTRATA HULAMIN SISHEN IRON ORE
COMPANY - ANGLO
MMC - MANGANESE METAL
COMPANY
PALABORA MINING COMPANY -
PMC
SAMREC
SAMSUNG SAPPI EXPORT
SERVICES PTY LTD
SASOL
SEABOARD INTERNATIONAL SIYANDA
TRONOX
INNOVATIVE COLLABORATIVE ADVOCACY ACROSS ALL STAKEHOLDERS AND MODES OF TRANSPORT
AURECON BARBERRY GROUP BIDFREIGHT PORT
OPERATIONS - BPO
BPL - BIDFREIGHT PANALPINA
LOGISITCS
GRINDROD LTD IMPERIAL LOGISTICS
ISAHA LANDSEA-LOGISTICS LBH
OCL- OUR CORRIDOR LOGISTICS PROSADC – LOADSMART QUATTRO LOGISTICS
SAVINO DEL BENE T-SYSTEMS
FNB/RMB
THE RIGHT MIX
DEPARTMENT OF
TRANSPORT
(Integrated freight)
IN PROGRESS: TOLL LOGISTICS
CTRACK; PROFESSIONAL
SHIPPING
IN PROGRESS:
TRANSNET
INNOVATIVE COLLABORATIVE ADVOCACY ACROSS ALL STAKEHOLDERS AND MODES OF TRANSPORT
Globally Supply Chains Compete Not Necessarily Only Products !!!
Hence The Cost And Efficiency Of Transport And Logistics Is A Key Component Of International Supply Chains
And Port Costs (Rates and efficiencies) Are But One Of Many Elements That Deserve Focus
A chain is as strong as its weakest link!
MANAGING TO TOTAL COST OF SUPPLY CHAINShttp://www.imanet.org/docs/default-source/thought_leadership/operations-process-management-innovation/managing_the_total_cost_of_global_supply_chains.pdf?sfvrsn=2
IMA – INSTITUTE OF MANAGEMENT ACCOUNTANTS – www.imanet.org
http://www.imanet.org/docs/default-source/thought_leadership/operations-process-management-innovation/managing_the_total_cost_of_global_supply_chains.pdf?sfvrsn=2
SHIPPER 1 - TEU via Durban to Hoganas, Sweden - CIF HOGANAS
ZAR/MT ZAR/MT ZAR/MT ZAR/MT ZAR/MT
2011 2012 2013 2014 2015
% of Pre
FOB% of
CIF Hog% Change
2011/2015
Rail 339 374 392 426 459 65% 23% 35%
Cargo dues 53 18 31 33 34 5% 2% -36%
THC 54 58 61 74 90 13% 5% 67%
Export documentation 20 20 26 12 17 2% 1% -15%
Empty container placement 0 73 110 110 15% 6%
Total PRE-FOB 465 543 511 654 710 100% 36% 53%
FOB-CIF ** delivered Hoganas 652 1463 1556 1423 1264 64% 94%
Delivered NST-Hoghanas - RTEU 1117 2006 2067 2077 1974 77%
SHIPPER 1
Rail Cargo dues
THC
Export documentaion
Empty container placement
SHIPPER 1 - 2015 PLANT TO FOB COST
35%
-36%
67%
-15%
RAIL
CARGO DUES
THC
EXPORT DOCUMENTAION
-60% -40% -20% 0% 20% 40% 60% 80%
SHIPPER 1 % RATE CHANGE 2011 TO 2015WORKS TO FOB
Series1
SHIPPER 2 – VIA DURBAN - DDP EUROPE
SHIPPER 2 - DDP EUROPE R/TEU R/T% OF FOB % OF DDP
Cargo Dues 2046 93 15% 7%
THC 1471 67 11% 5%
Contsainerisation & cross hauls 4025 183 30% 14%
Customs clearance 1500 68 11% 5%
Shipping Line Release Fee 1000 45 7% 3%
Transport to DBN 3500 159 26% 12%
WORKS TO FOB 13542 616 100%
Ocean freight -Europe 1100 14631 665 50%
CIF to DDP 100 1330 60 5%
29504 1341 100%
15%
11%
30%11%
7%
26%
SHIPPER 2 - PLANT TO FOB
Cargo Dues
THC
Contsainerisation & crosshauls
Customs clearance
Shipping Line Release Fee
Transport to Dbn
7%
5%
14%
5%
3%
12%
50%
5%
0% 10% 20% 30% 40% 50% 60%
CARGO DUES
THC
CONTSAINERISATION & CROSS HAULS
CUSTOMS CLEARANCE
SHIPPING LINE RELEASE FEE
TRANSPORT TO DBN
OCEAN FREIGHT -EUROPE
CIF TO DDP
SHIPPER 2 – PLANT TO DDP EUROPE
Contextualise the LPI for Regional Expansion
WB 2014 LPI Customs Infrastructure Int shipments Logistics Q &C Track & Trace Timeliness
LPICountry score rank score rank score rank score rank score rank score rank score rank
Germany 4.12 1 4.10 2 4.32 1 3.74 4 4.12 3 4.17 1 4.36 4
HK, China 3.83 15 3.72 17 3.97 14 3.58 14 3.81 13 3.87 13 4.06 18
South Africa 3.43 34 3.11 42 3.20 38 3.45 25 3.62 24 3.30 41 3.88 33
Malawi 2.81 73 2.79 62 3.04 48 2.63 108 2.86 70 2.63 100 2.99 100
Namibia 2.66 93 2.27 125 2.57 81 2.70 97 2.69 86 2.56 106 3.15 82
Angola 2.54 112 2.37 114 2.11 140 2.79 84 2.31 128 2.59 103 3.02 96
Botswana 2.49 120 2.38 112 2.23 125 2.42 129 2.58 99 2.40 127 2.94 103
Zambia 2.46 123 2.54 86 2.31 115 2.13 152 2.47 114 2.47 120 2.91 105
Lesotho 2.37 133 2.22 129 2.35 110 2.48 122 2.23 137 2.35 132 2.60 139
Zimbabwe 2.34 137 1.89 154 2.25 123 2.25 143 2.50 108 2.22 143 2.93 104
Tanzania 2.33 138 2.19 135 2.32 114 2.32 137 2.18 145 2.11 150 2.89 107
Mozambique 2.23 147 2.26 126 2.15 135 2.08 154 2.10 153 2.08 152 2.74 134
Congo, Dem. Rep. 1.88 159 1.78 158 1.83 156 1.70 160 1.84 158 2.10 151 2.04 159
RANGE OF LPI’S GREATEST CHALLENGE TO REGIONAL
TRADE GROWTH
SOLUTIONINNOVATIVE
COLLABORATION TO WORK
TOGETHER TO IMPROVE QUALITY OF SUPPLY CHAIN
SERVICES Regional Expansion: Overcoming Logistical Challenges to enable Southern African Supply Chains
SUMMARY –Port Cost As A Component Of Total Supply Chain Cost• Port cost are very important – every R = impact on global competitiveness
• Port regulator has demonstrated the importance of its role in SA
• We have to focus on ALL elements from plant to destination
• Equal focus on operational efficiency and costs
• All elements have to be benchmarked - individually and collectively
• All elements have to be regularly evaluated - individually and collectively
• Equal collaborate advocacy – across all elements – public private dialogue
• Very important that all stakeholders contribute to create a greater understanding of the impact of all elements collectively across our distribution chain.
• Lets look at the current work/documents on the table from DoT – it is our responsibility to play our role as users/shippers & service providers
Areas currently on the DoT table to name but some:1. The Launch of the National Transport Forum – Member Pillar 1 2. Development of the Integrated Multi-modal Transport Planning and
Coordination draft bill3. NATMAP 20504. National Freight Logistics Strategy5. National Corridor Strategy6. National Land Transport Strategic Framework 2015-20207. Road Infrastructure Planning Strategy8. Maritime Technical Committee Discussion Document9. Re-visiting and potential redrafting of the ports bill10. Twenty First Amendment) to the National Road Traffic Regulations. The Government Gazette is No 38142 published on 31 October 2014
11. STER ……………..and many moreDOCUMENTS IN THIS REGARD AVAILABLE FROM SASTALC
SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-• Strengthen mandate through > 25 industry associations – local, regional,
continental, global• Double membership since July 2014• Department of Transport joined as strategic government department member
= PPP• Acknowledged by SADC as regional industry organisation• MoU with Africa Union of Shippers Councils• Facilitated SG of global shippers forum – 2 s/h engagements on Safe Container
Packing and Mandatory verification of container weights• Facilitated engagement with SAMSA & Keys s/h’s – Mandatory Verification of
Gross Container Weights – (All export containers to be shipped from 1 July 2016)
• Facilitated a visit by high level delegation of Congolese Shippers Councilto engage with TRANSNET/ TPT/TFR/other terminals
• Submission to Minister of Transport on proposed freight truck ban over peak hours
SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-• Nominated to the board of the EMC - various meetings• Participated in the NBF Afri-ID Working Group North South Rail Corridor
Meeting• Participated in the various TRANSPORTSIG Transport Forums• Participated in the Rail Working Group Meeting – Luxemburg Protocol –
register for rail equipment – finance security• SADC Business forum in Gaborone - first SA shippers/transport representation• COMESA – Transport association meeting invited by USAID• Submission to NPR – pricing application• PCC’s • Participate in SARS stakeholder meetings• Participate in associate member activities• Submission to the NPR – on 5 year evaluation & sent out questionnaire• Submission to DTI on the RIA of the Export development bill and sent out
survey
SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-• Tripartite Transport and Transit Facilitation Programme Meeting in Gauteng in
August-Harmonisation of cross border transport –• Prior meetings:
• Vehicle load management strategy and implementation plan &• Vehicle load management MoU (VLM MoU)
• This meeting considered the validation of the following:• Tripartite vehicle regulations and standards• Driver Training and Licencing for Commercial Vehicles• Harmonisation of Cross border Third Party Motor Vehicle Insurance Schemes• Proposed Self regulatory Scheme – RTMS• Tripartite Transport Registers (TRIPS), information platform and systems
• Vehicles, Drivers, Operators, Infringements, etc.• Draft multi-lateral Cross border road transport agreement (MCBRTA)• Implementation Plan for the Harmonised Tripartite Cross Border Road Transport Regulations and StandardsDOCUMENTS IN THIS REGARD AVAILABLE FROM SASTALC
• Mentoring women and youth industry associations• Conference presentation to promote the SA transport infrastructure and
services as a voice of the shipper and their service providers• Logistics business breakfast – facilitate public private sector dialogue !) Ports
and Shipping 2) Road Regulations 3) Changing Customs Environment 4) Rail -right balance – opportunities and challenges
Please diarise the date of our last Logistics Business Breakfast
Date: 13th October 2015Topic: Rail and Intermodal Transport
“The benefits and challenges of the right balance”SAFE TRAVELS – REMEMBER LIGHTS ON SAVES LIVES
BIDFREIGHT PORT OPERATIONS - BPO
BARBERRY GROUP
SEABOARD INTERNATIONAL
IMPERIAL LOGISTICS
OVERVIEW- DIAGRAM
PUBLIC SECTOR
SARS Legal
A
Act 30 and Act 31
Rules
StandardOperatingProcedure
B
Data field Management
C
SARS -Operations
Inter front
D
PRIVATE SECTOR
Importer
Exporter
Guarantee/Risk
Activity
Licencing/Registration
LegalEntity
Person Facility
e-filing
EDI
Data fields
IT Platform
Reporting
Time
Data field
Compliance
Audit
1
23
4
5
Policies
Excise Act 91
Extended Supply ChainTrade
• Risk Profile/Behaviour Patterns• Compliance• Import/Export –
Gap - Agent
Result in deliverables