Intelligent logistics from the entrepreneurial perspective

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1 Intelligent logistics from the entrepreneurial perspective Marc Huybrechts, President CLECAT International Maritime Congress, Szczecin, Poland 13 June 2013

2 Agenda CLECAT Our role Globalisation and trade facilitation Need for Simplication Scenario for trade facilation Intelligent Logistics: opportunities and challenges icargo 2

3 Who do we represent European Association for Forwarding, Transport, Logistic and Customs Services, established in 1958 European umbrella organisation of national federations of logistic operators, freight forwarders and customs agents Representing companies (from multinationals to SME s and family businesses) employing over 1 million people Co-operating with international freight forwarders association FIATA 3

4 Our role General considerations Freight forwarders facilitate transport and trade Their mission is to offer the best possible transport and trade related services in the best possible conditions and cost-efficient solution Freight forwarders have every interest in the highest possible logistic efficiency Freight forwarders are essentially neutral in respect of the transport mode CLECAT fully supports initiatives to facilitate the movement of cargo Plea for a holistic supply chain approach Complexity of the supply chain What is gained on one side should not be lost on the other side 4

5 Globalisationin the past 5

6 Globalisationnow Much the same (ship manifest, contract of carriage, trade arrangements) o Exponential growth o Complexity Need to regulate trade compliancein o Economic (import/export/transit) o Fiscal (VAT, fraud) o Safety& security (FAL, ENS/EXS) o Health (veterinary, fytosanitary) o Environment (TSCA) Increased administrative burden Threat seamless supply chains 6

7 What is at stake? Trade facilitation costs = 1 to 15% of landed cost of imported good OECD: 1% TF improvements to world economy US$40 billion Each additional day of delay prior to shipment reduces trade by more than 1 %(Djankovet al., 2006) 7

8 Where are the problems? 8

9 Need for simplification but trends that make business more complex : Security / Safety Supply Chain efficiency Cargo traceability along supply chain (visibility) Customs trends New roles of ports transform into effective logistics platforms for trade beyond the port boundary Forwarders between the chair or always winner? Architect of data Securing compliance in overregulated world 9

10 A scenario for more intelligent trade facilitation? Cassandra model a global date pipeline build on existing trading practices Control through Supply Chain C visibility Trust through transparency Capturing reliable source date (stuffing/consolidation) Connectivity with Single Windows Minimise transaction costs to share date in hybrid communities System based control: facilitations being in control together Self assessment (MCC+) Green lane/pre-clearance/entry in records/no declarations Government piggy back on supply chain management 10

11 Current Customs and International Trade Systems 3 rd Country Regulation Contract of Sale, Invoice and Payment EU Regulation Risk Assessment for admissibility and compliance Risk Assessment for admissibility and compliance Fiscal and Statistics Collection Post Export Assurance by Government Customs Export declaration (with overvalued invoices for recovery of tax) Safety & Security by B/L declaration from Carrier Unloading permission by ships manifest Customs Declaration for Home Use or Regimes (undervalued for duty purposes) Post Clearance Assurance by Government Consignor or Exporter Freight Forwarder or 3PL Bill of Lading Container/Carrier Manifest Freight Forwarder or 3PL Consignee or Importer CARGO Port 1 Port 2 CARGO CARGO Country A Handling Fees Packing List Insurance Contracts of Carriage Country B Letter of Credit Shipping Note Carriers Receipts House Way Bill Vessel Booking Freight Account

12 Future Customs and International Trade Systems Data relating to the goods and the people Post Export Assurance by Customs Contract of Sale, Invoice and Payment 3 rd Country Regulation Freight Forwarder or 3PL Seamless Integrated Data Pipeline Carrier EU Regulation Freight Forwarder or 3PL Post Clearance Assurance by Customs Consignor or Exporter Manifest Consignee or Importer CARGO Port 1 Port 2 CARGO CARGO Data relating to carriage GPS position and trader ID Country A GPS position and trader ID Handling Fees Packing List Letter of Credit Carriers Receipts GPS position and trader ID GPS position and trader ID Insurance Contracts of Carriage Shipping Note House Way Bill GPS position and trader ID Country B Hesketh, Heijmann 2010 Vessel Booking Freight Account

13 National Community Platforms servicing buyer and seller joined by the pipeline interface Carrier Barge operators Terminals Ship broker Forwarders Seller Exporters Carrier Ship broker Barge operators Forwarders Terminals Pipeline Rail operators Port authorities National community system -PPP Road hauliers Importers Empty depots Customs Trade / Government Dashboard / SW Inspection stations Rail operators National community system - PPP Empty depots Buyer Importers Port authorities Road hauliers Inspection stations Customs Trade / Government Dashboard / SW Trade / Government Dashboard / SW Exporters Hesketh / Heijmann 2012

14 Share the benefits! That s not fair! 14

15 Intelligent Logistics opportunities and challenges Growing need for visibilityand real time date - Huge potential of the use of SaaSand cloud based solutions (access to data enabled mobile apps etc) Internet of Things technologies, such as intelligent cargo applications But today business is far from a paperless situation Across modes Across countries Along the whole supply chain : planning, execution, monitoring and reporting => Zero paper documents, zero waiting time at hubs, technology independent 15

16 Situation today in European multimodal transport Complexity of freight transport information exchange in an multimodal transport context: lack of interoperability along the supply chain need for provision of information several times for different purposes lack of information on multimodal availabilities lackof integration of information from tracking and tracing technologies and intelligent cargo applications inefficiencies, costs, reduced visibility of freight, perceived complexity for multimodal transport, sub-exploitation of multimodal transport, non-optimized use of existing transport infrastructure. 16

17 Barriers Lots of small business lacking knowledge, time and money Lack of interaction between different data exchange systems used by shipper, 3PL and carrier Costs of integration (too many standards with different modes) Reluctance to abandon customised systems for logistics (eplatform) Costs of integration (too many standards within different modes of transport) 17

18 Challenges Solutions are available but implementations on a large scale are slow to appear It is not only about technologies, but about change in organisation and behaviour Sharing of information requires trust and co-operation Co-operation requires interoperability Interoperability requires standardised solutions 18

19 The advantages are clear for the chain Interoperability of transport ICT systems = make actors understand each other easily Run transport business processes smoothly across organisational boundaries Reduce administrative burden Enhanced supply chain visibility and security Optimisation of logistics chains may help to increase also environmental performance and cost efficiency 19

20 icargoproject The icargoproject aims at advancing and extending the use of ICT to support new logistics services that: Synchronize vehicle movements and logistics operations across various modes and actors to lower CO2 emissions Adapt to changing conditions through dynamic planning methods involving intelligent cargo, vehicle and infrastructure systems and Combine services, resources and information from different stakeholders, taking part in an open freight management ecosystem. 20

21 The icargo Vision 21

22 Thank you

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