Analytical study on The Role of Freight Forwarders & their Marketing in International Business done by Viraj Hegde for PG Diploma in International Business A brief study on understanding the role of freight forwarders in the International Business landscape. This project was facilitated by Channel Freights Pvt. Ltd. (www.channel-freight.com)

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A Field Study Report on
“The Role of Freight Forwarders
&
their Marketing in International Business”
Conducted Under:-
Channel Freight Service India Pvt. Ltd.
Submitted By:-
Viraj Rajaram Hegde
In partial fulfillment of
Post Graduate Diploma in International Business
(P.G.D.I.B)
University of Pune
Submitted To:-
College of Commerce, Science & Information Technology
(C.S.I.T)
STP Building 'C', Chikhali Road, Purna Nagar,
Pune - 411019.

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DECLARATION
I hereby declare that the Field Study presented in this report
entitled
“The Role of Freight Forwarders & their Marketing in International
Business”
is an outcome of my efforts involved in study at
Channel Freight Service India Pvt. Ltd, Pune
under the guidance of Prof. Punamkumar Hinge, CSIT and submitted
the same as an original for the partial fulfillment of
Post Graduate Diploma in International Business
(P.G.D.I.B)
University of Pune
I also declare that this field report or thereof is for academic
purpose only and has not been submitted by me for a degree/diploma
of any university.
DATE: - 17/03/2010 Viraj. R. Hegde
PLACE-: Chinchwad, Pune - 19 (Researcher)

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Company Certificate

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Certificate
This is to certify that the Field Study “The Role of Freight
Forwarders & their Marketing in International Business” conducted under
Channel Freight Service India Pvt. Ltd, Pune is prepared by Mr. Viraj R Hegde,
student of P.G.D.I.B, a course of University of Pune, conducted by our Institute.
This is an original study & has not been copied from any previous
reports submitted to the University. All important sources used have been duly
acknowledged in the report. This report is submitted in partial fulfillment of
P.G.D.I.B curriculum as per the rules of University of Pune.
Director Project Guide

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Executive Summary
India has today made a mark in the world’s economy.
Import & Export sector thus have played a vital role to bring India to this position.
A student studying international business can never make a mistake of not
highlighting the factors that have made India strong in foreign trade. Hence this
sector consists of various entities. Again there are various players in each
category. Further competition persists between them. This field survey stress on
two major aspects
1) The role of freight forwarders in the International Business operations.
2) Marketing of the Freight Forwarders.
The operational aspects consists details about the entities,
procedures, problems & solutions related to the freight forwarder. While the
Marketing aspects highlight details as per the 7 P’s , Product, Price, Place,
Promotion, People, Process, Physical Evidence. Earnest efforts through field visits
have been made to compile the information.
Thank You.

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Acknowledgement
A Knowledge base can never be generated without the right kind of
guidance from right people. I am fortunate to be mentored by such people. I
thank Mr. Shamprasad N, Branch Manager, Channel Freight Service India Pvt. Ltd,
Pune. Who provided me an opportunity to conduct this field visit & also guided
me through various aspects of this business. I deeply thank Mr Mahadeo who has
played a vital role for almost all the information collection in this study.
I am obliged to Mr. D.N.Hegde, Kirloskar oil Engines, who has been
an unofficial guide for me throughout this study.
‘A good teacher is like a candle - it consumes itself to light the
way for others’
Lastly but not the least I thank Prof Punamkumar Hinge who has
always been with me with his timely guidance. Special thanks to Vice Principle
Priya Ranbhise & Prof. Gopalkrishna for their insights.
DATE:- 17/03/2010 Viraj . R. Hegde
PLACE-: Chinchwad, Pune - 19 (Researcher)

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Index
Chapter
No.
Topic
Page
No.
1 Introduction 1
2
Organizational
Background
6
3 The Study 10
4
Data Collection
&
Representation
13
5
Finding
&
Limitations
40
6
Suggestions
&
Conclusion
42
7 Annexure 43
8 References 44

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-Concept of the Study:-
-Area of the Study:-
-Reasons for selecting this area:-
-Importance of Study:-

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Concept of the Study
‘A field study is a study in which the researcher goes to a
research site and observes and asks questions, but does not change anything. It's
like a naturalist observing wildlife without doing anything like setting out food to
attract animals, or making obstacles to see how the animals react.’
A field study provides first hand information about the ongoing
events and processes. The researcher gets hands on experience about the topic
he is studying. The freight forwarders work in a very less tangible atmosphere and
hence it becomes absolutely essential to personally witness the process in its
natural setting to gain accurate knowledge about freight forwarding.
Marketing is the social process by which individuals and groups
obtain what they need & want through creating and exchanging products & value
with others. --Phillip Kotler
Marketing today is an integral part of each and every business,
be it product oriented or service oriented. Marketing specializations help the
organizations to know their customers well, differentiate their products/services
& remain growth oriented. This study report constantly highlights the importance
of marketing for the freight forwarders in the prevailing competitive atmosphere.

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‘A research is any gathering of data, information & facts for the
advancement of knowledge.’
Following the quote above an earnest attempt has been made to
study the role of the freight forwarders & their marketing in the International
business.
Area of the Study
A. EXPORTS (including re-exports)
Exports during December, 2009 were valued at US $14606 million (Rs. 68107
crore) which was 9.3 per cent higher in dollar terms (4.8 per cent in Rupee
terms) than the level of US $ 13368 million (Rs. 65015 crore) during December,
2008. Cumulative value of exports for the period April- December , 2009 was
US $ 117587 million (Rs 563304 crore) as against US $ 147569 million (Rs.
652919 crore) registering a negative growth of 20.3 per cent in Dollar terms
and 13.7 per cent in Rupee terms over the same period last year.
B. IMPORTS
Imports during December, 2009 were valued at US $ 24753 million
(Rs.115420 crore) representing a growth of 27 per cent in dollar terms (22 per
cent in Rupee terms) over the level of imports valued at US $ 19456 million (
Rs. 94625 crore) in December, 2008. Cumulative value of imports for the

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period April- December 2009 was US $ 193829 million (Rs. 927969 crore) as
against US $ 253809 million (Rs. 1126199 crore) registering a negative growth
of 23.6 per cent in Dollar terms and 17.6 per cent in Rupee terms over the
same period last year.
Export and Import is one of the most lucrative sectors. The economic
meltdown had impacted the sector to quite an extent, but the sector is
recovering again and appearing to be even more promising now. The whole
process of Import and export consists of various business entities. Out of these
Freight Forwarders will be the focus of this report.
Reasons for selecting this area
An Essential entity
A Unique entity due to
challenging process
An Interest
Freight Forwarders are absolutely
essential today for most of the
companies eyeing the
International Market.
Freight forwarders get involved in
processes that are intangible and
yet absolutely essential. Keen
observation & study is required
to understand these processes
The Import & Export sector has
been a personal area of interest

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Importance of Study
Academic Importance:-
This kind of field study helps in practical application of the
theoretical concepts learnt inside the classroom.
Importance to the Organization:-
The organization gets a compiled set of information which can
be utilized for quick reference. Also suggestions given may help bring
improvements in the organization. The report can also act as a promotional tool.
Importance to the consumer:-
The consumers can get ready made info about the
organization. Also new players can essentially understand the role of freight
forwarders & how freight forwarders ease the processes.

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Inception & Progress:-
Channel Freight Services (I) Pvt Ltd. Emerges along with the new millennium
bringing in a lot of youth, enthusiasm, experience & single mindedness to give
customer care a new dimension. Its credo is made up of 3 significant expressions
which all its teams carry on their sleeves.
Innovative – Proactive – Speed
Channel Freight Services (I) Pvt Ltd. Is a part of multifaceted corporate house that
has, since 2000 established itself as a conglomerate of individual entities with a
strong presence in Airfreight, Sea freight & in multi-modal international
transportation? Its credo has since carried it to where it stands today. Its scope of
services includes Airfreight Forwarding, Ocean Freight Forwarding, Custom
brokerage, Transportation, Warehouse/insurance, Consolidation Services,
Projects, Dangerous cargo, Air & Sea Charters.
Milestones:-
Channel Freight began operations during the summers of 2000 from a small
apartment in the vicinity of the cargo complex at Sahar. Business Expanded,
customer base grew & armed with a team of qualified professionals, performing

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together towards excellence the company has created for itself a bank of satisfied
customers.
June 2000
The team expanded from just 10 persons to 22 and the office was moved to an
independent self-contained office building in the same locality. Activities
increased multi fold. Overseas associates began full-fledged operations.
January 2002
The team expanded to 55 professionals & Channel Freights moved to a bigger &
better equipped premises just next door to the cargo complex & branches were
opened in Pune, Delhi, Bangalore, Chennai, Hyderabad, Baroda, Ahmadabad &
Goa. Time became the essence. Customer focus received recognition.
Corporate Mission:-
➢ To be the most efficient and comprehensive distribution service network
through a continuous effort in upgrading the key elements that forms the
very basis of the service.
➢ Provide quality-enriched logistics solutions by proficiently using innovating
methods and advance technology, through a spirit of partnership.

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Highlights of the Services:-
➢ Inbound & outbound Consolidation
➢ Sea/Air Freight Forwarding
➢ Supply Chain Solution
➢ NVOCC (non vessel operating common carrier
➢ Linear Operation
➢ Handling ODC (Over Dimension) Shipments
➢ Custom Clearance
➢ Door Delivery
➢ Container Transportation

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-Methodology
-Objectives
-Hypothesis

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Methodology
Desk Study
Hypothesis Formulation
Hypothesis Formulation
Data Collection
Primary Data
Secondary Data
Field Work
Data Processing & Assimilation
Final Research Report
1.
2.
3.
4.
5.
6.
7.

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Objectives
➢ To understand the importance of the freight forwarder in the international
business.
➢ To apply marketing concepts to freight forwarding process.
➢ To study about the formalities involved in the freight forwarding.
➢ To gain knowledge about the allied activities.
Hypothesis
➢ Freight Forwarders act just like an agent and don’t take any title or risks
w.r.t the client’s goods.
➢ Freight Forwarders don’t require marketing, as they handle products of
their clients.

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➢Primary Data:-
A field visit to the Channel Freight’s premise was
conducted to collect first hand data. The visit included discussions with the
head & employees. Also a field visit to Dynamic Logistics, Dighi was
conducted from where the clearance activities take place in Pune.
➢Secondary Data:-
Additional information has been collected from
internet, books, documents, past project reports, newspapers etc.

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Data Representation
ANALYSIS OF INDIAN TRADE
A review of India’s foreign trade since the commencement of planning reveals the
following important points:
1. Both exports and imports have grown considerably.
2. Except for two years (1972-73) and (1966-77), in all years since 1951 imports
were larger than exports.
3. Until about the mid 1980sthe export performance of India was very poor in
Comparison with other countries in general; it was very poor even in comparison
with several other developing countries. This is clear from the following facts:
a) The share of India in the total world exports fell from about 2 per cent in
1950 to 0.4 per cent in 1980. Since the mid eighties, there has, however,
been some improvement. In 2002 it was 0.8 per cent and the target set by
the Ministry of Commerce is one per cent by 2007.
b) India the 13th
largest exporter in 1950 but there were 28 countries above
India in 2005. This marks a slight improvement over the recent past.
c) India’s merchandise exports as a percentage of GDP had been stagnating
around 5 per cent. Although it has improved since the liberalization, it is

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still very low (little above 13 per cent) even in comparison with many other
developing countries
SHARE OF INDIA IN WORLD EXPORT
Year Share (%)
1950 2.0
1960 1.2
1970 0.7
1980 0.4
1990 0.5
2000 0.7
2006 1.0
2007 1.0
2008 1.0
4) The terms of trade have, on the whole, been favorable to India, although there
was deterioration in a number of years.
5) There has been a very significant change in composition of India’s exports.
Manufactured products one account for over three-fourths of the exports as
against the dominance of primary commodities in the early period.
6) They have been significant changes in the direction (i.e. the source of imports
and destination of exports) of India‘s foreign trade.

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INDIA’S EXPORT DURING LAST 8 YEARS
Years Export (in millions) Growth Rate
2000 44560 21.0
2001 43627 -1.6
2002 52719 20.3
2003 63843 21.1
2004 83563 30.8
2005 103091 23.4
2006 115849 26.29
2007 1241600 28.27
2008
0
20
40
60
80
100
120
140
2000 1 2 3 4 5 6 7 8
44.56 43.827
52.719
63.843
83.563
103.091
115.849
124.6
Exportinmillions
years
INDIA'S EXPORTS
export (
millions)
Merchandise export of the country nearly doubled to US$ 124.6 billion in the
ending 2007-08 from 63.84$ billion from 2004 an annual compounded growth
of 25 per cent compared to 12.73 present in the previous years during 2007-
08.

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INCOTERMS
Incoterms are ICC's (International Code Council) standard definitions of trade
terms and are internationally recognized as indispensable evidence of the buyer's
and seller's responsibilities for delivery under a sales contract.
EXW FCA FAS FOB CFR CIF CPT
SERVICES Ex
Works
Free
Carrier
Free
Alongside
Ship
Free
Onboard
Vessel
Cost &
Freight
Cost
Insurance
& Freight
Carriage
Paid To
Warehouse Storage Seller Seller Seller Seller Seller Seller Seller
Warehouse Labor Seller Seller Seller Seller Seller Seller Seller
Export Packing Seller Seller Seller Seller Seller Seller Seller
Loading Charges Buyer Seller Seller Seller Seller Seller Seller
Inland Freight Buyer Buyer/
Seller*1
Seller Seller Seller Seller Seller
Terminal Charges Buyer Buyer Seller Seller Seller Seller Seller
Forwarder’s Fees Buyer Buyer Buyer Buyer Seller Seller Seller
Loading On Vessel Buyer Buyer Buyer Seller Seller Seller Seller
Ocean/Air Freight Buyer Buyer Buyer Buyer Seller Seller Seller
Charges On Arrival At Destination Buyer Buyer Buyer Buyer Buyer Buyer Seller
Duty, Taxes & Customs Clearance Buyer Buyer Buyer Buyer Buyer Buyer Buyer
Delivery To Destination Buyer Buyer Buyer Buyer Buyer Buyer Buyer
*1. There are actually two FCA terms:
FCA Seller's Premises where the seller is responsible only for loading the goods
and not responsible for inland freight; and
FCA Named Place (International Carrier) where the seller is responsible for inland
freight.

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CIP DAF DES DEQ DDU DDP
SERVICES Carriage
Insurance
Paid To
Delivered
At
Frontier
Delivered
Ex Ship
Delivered
Ex Quay
Duty
Unpaid
Delivered
Duty
Unpaid
Delivered
Duty
Paid
Warehouse Storage Seller Seller Seller Seller Seller Seller
Warehouse Labor Seller Seller Seller Seller Seller Seller
Export Packing Seller Seller Seller Seller Seller Seller
Loading Charges Seller Seller Seller Seller Seller Seller
Inland Freight Seller Seller Seller Seller Seller Seller
Terminal Charges Seller Seller Seller Seller Seller Seller
Forwarder’s Fees Seller Seller Seller Seller Seller Seller
Loading On Vessel Seller Seller Seller Seller Seller Seller
Ocean/Air Freight Seller Seller Seller Seller Seller Seller
Charges On Arrival At Destination Seller Buyer Buyer Seller Seller Seller
Duty, Taxes & Customs Clearance Buyer Buyer Buyer Buyer Buyer Seller
Delivery To Destination Buyer Buyer Buyer Buyer Seller Seller
The 13 INCOTERMS
What are INCOTERMS?
Inco terms are a set of simple three letter codes which represent the different
ways international shipments may be organized. They allow sellers and buyers
from different cultures and legal systems to decide at what point the ownership
and paying for freight, insurance and customs costs transfer from one to the
other.

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Who decides what INCOTERMS mean?
The International Chamber of Commerce has set up strict definitions for each
incoterm.
Choosing a suitable incoterm allows the buyer and seller to negotiate a price best
suited to their needs and to be confident that there will be no confusion over who
pays the costs. To ensure that the latest version is being used shipping contracts
should refer to "INCOTERMS 2000".
When should INCOTERMS be used?
It is not compulsory to use incoterms. However when things go wrong and
disputes arise it is much easier to sort out who is responsible for what if
incoterms have been written into the shipping contract. To be safe, incoterms
should be decided upon in the negotiation phase of any international purchasing
contract.
How do INCOTERMS work?
Each INCOTERM is a three letter acronym related to where the seller's
responsibility ends. They should be written into the purchasing or shipping
contracts. Some incoterms require the changeover point to be named. As well as
buyer and sellers there are "carriers". They are the people who have a contract to
transport the goods by land, sea, air or a combination of modes. A seller will be

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given a bill of lading, way bill or carrier's receipt, that document can be used to
prove that the goods have been taken on by the carrier.
There are four groups of INCOTERMS - "E", "F", "C" & "D"
Group:E
used where the seller does not want to arrange transport.
EXW - "Ex-Works" means the seller's only responsibility is to make the goods
available at the seller's premises, i.e., the works or factory. The seller is not
responsible for loading the goods on the vehicle provided by the buyer unless
otherwise agreed. The buyer bears the full costs and risk involved in bringing the
goods from there to the desired destination.
"Ex works" represents the minimum obligation of the seller.
Group:F
used where the seller can arrange some transport within his/her own country.
FCA - Free Carrier, This term has been designed to meet the requirements of
multi-modal transport, such as container or roll-on, roll-off traffic by trailers and
ferries. The seller fulfils his/her obligations when the goods are delivered to the
custody of the carrier at a named point. If no precise point can be named at the
time of the contract of sale, the parties should refer to the place where the carrier

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should take the goods into its charge. The risk of loss or damage to the goods is
transferred from seller to buyer at that time.
FAS - Free alongside Ship, requires the seller to deliver the goods alongside the
ship on the quay. From that point on, the buyer bears all costs and risks of loss
and damage to the goods. F.A.S. requires the buyer to clear the goods for export
and pay the cost of loading the goods.
FOB - Free On Board vessel, named ocean port of shipment.
The goods are placed on board the ship by the seller at a port of shipment named
in the sales agreement. The risk of loss of or damage to the goods is transferred
to the buyer when the goods pass the ship's rail (i.e., off the dock and placed on
ship. . .
The seller pays the cost of loading the goods. –
Group:C-
used where the seller can arrange and pay for most of the freight charges up to
the foreign country.
CFR - (or C&F) Cost and Freight, Named ocean port of destination,
requires the seller to pay the costs and freight necessary to bring the goods to the
named destination, but the risk of loss or damage to the goods, as well as any cost

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increases, are transferred from the seller to the buyer when the goods pass the
ship's rail in the port of shipment. Insurance is the buyer's responsibility.
CIF - Cost, Insurance and Freight, named ocean port of destination.
This is CFR with the additional requirement that the seller procure transport
insurance against the risk of loss or damage to goods. The seller must contract
with the insurer and pay the insurance premium. Insurance is generally important
in international shipping because transport companies have restricted liability for
loss or damage.
CPT - freight/Carriage paid to, named place or port of destination.
This term means the seller pays the freight for the carriage of the goods to the
named destination. The risk of loss or damage to the goods and any cost increases
transfers from the seller to the buyer when the goods have been delivered to the
custody of the final carrier, and not at the ship's rail. Accordingly,
"freight/carriage paid to" can be used for all modes of transportation, including
container or roll-on roll-off traffic by trailers and ferries. When the seller is
required to furnish a bill of lading, way bill, or carrier receipt, the seller duly fulfils
its obligation by presenting such a document issued by the person contracted
with for carriage to the main destination.

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CIP - Carriage and Insurance Paid To named place or port of destination.
This term (also abbreviated CIP) is the same as "freight/carriage paid to" but with
the additional requirement that the seller has to procure transport insurance
against the risk of loss or damage to the goods during the carriage. The seller
contracts with the insurer and pays the insurance premium.
Group:D-
used where the seller can pay for most of the delivery charges to the
destination country.
DAF - Delivered at Frontier, named place of destination, by land, not unloaded.
This term means that the seller's obligations are fulfilled when the goods have
arrived at the frontier but before the customs border of the country named in the
sales contract. The term is primarily used when goods are carried by rail or truck.
The seller bears the full cost and risk in delivering the goods up to this point, but
the buyer must arrange and pay for the goods to clear customs.
DES - Delivered Ex-Ship, named port of destination, not unloaded.
This term means the seller makes the goods available to the buyer on board the
ship at the destination named in the sales contract. The seller bears the full cost
and risk involved in bringing the goods there. The cost of unloading the goods and
any customs duties must be paid by the buyer.

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DEQ - Delivered Ex-Quay, named port of destination, unloaded, not cleared.
This term means the seller has agreed to make the goods available to the buyer
on the quay or the wharf at the destination named in the sales contract. The
seller bears the full cost and risks in delivering the goods to that point including
unloading. There are two variations of ex quay contracts: "ex quay duty paid" and
"ex quay duty on buyers account." In the first, the duty is paid by the seller. In the
second, the duty also is paid by the seller, but the buyer must reimburse the
seller.
DDU - Delivered Duty Unpaid, named place of destination, not unloaded, not
cleared.
This term Delivered duty paid or under these terms, the seller fulfils his obligation
to deliver when the goods have been available to the buyer nucleated for import
at the point or place of the named destination. The seller bears all costs and risks
involved in bringing the goods to the point or place of named destination. There is
no obligation for import clearance.
DDP - Delivered Duty Paid, named place of destination, not unloaded, cleared.
This term represents the seller's maximum obligation. The term "DDP." is
generally followed by words indicating the buyer's premises. It notes that the
seller bears all risks and all costs until the goods are delivered. This term can be

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used irrespective of the mode of transport. If the parties wish to make clear that
the seller is not responsible for certain costs, additional word should be added
(for example, "delivered duty paid exclusive of VAT and/or taxes").
TYPES OF CONTAINERS – 40’
45' High Cube Dry40' Dry Freight
40' Open Top 40' Flat Rack

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40' Collapsible Flat Rack 40' Platform
40' Reefer 40' High Cube Reefer
TYPES OF CONTAINERS – 40’
CONTAINER INFORMATION
40 FT. STANDARD CONTAINER
Dimensions: Length Width Height
Overall
40' = 12192 mm 8' = 2438 mm 8' 6" = 2591 mm
Internal
39' 5.25" = 12022 mm 7' 5.625" = 2352 mm 7' 10.25" = 2395 mm
Door Opening
7' 8.25" = 2343 mm 7' 5.75" = 2280 mm
Weights:
Max. Gross 67200 lbs = 30480 kg
Tare 8600 lbs = 3900 kg
Max. Payload 58600 lbs = 26580 kg
Cube: 2392 cu. ft. = 67.7 m3

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INTERNATIONAL FREIGHT FORWARDING
20' Dry Freight 20' Open Top
20' Flat Rack 20' Tank
TYPES OF CONTAINERS – 20’
CONTAINER INFORMATION
40 FT. "High Cube"
Dimensions: Length Width Height
Overall
40' = 12192 mm 8' = 2438 mm 9' 6" = 2895 mm
Internal
39' 3.25" = 12022 mm 7' 8.5" = 2352 mm 8' 10.25" = 2700 mm
Door Opening
7' 5.75" = 2340 mm 8' 5.75" = 2585 mm
Weights:
Max. Gross 67200 lbs = 30480 kg
Tare 9150 lbs = 4150 kg
Max. Payload 58050 lbs = 26330 kg
Cube: 2697 cu. ft. = 76.4 m3

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Freight forwarders typically arrange cargo movement to an international
destination. Also referred to as international freight forwarders, they have the
expertise that allows them to prepare and process the documentation and
perform related activities pertaining to international shipments. Some of the
typical information reviewed by a freight forwarder is the commercial
invoice, shipper's export declaration, bill of lading and other documents required
by the carrier or country of export, import, or transshipment. Much of this
information is now processed in a paperless environment.
The original function of the forwarder, or speedier, was to
arrange for the carriage of his customers' good by contracting with various
carriers. His responsibilities included advice on all documentation and customs
requirements in the country of destination. His correspondent agent in far-away
lands looked after his customers' interests and kept him informed about matters
that would affect movement of goods.
Freight forwarding-
A freight forwarder is a third party logistics provider. A third party logistics
forwarder dispatches shipments via asset-based carriers and books or otherwise

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arranges space for those shipments. Carrier types include waterborne vessels,
airplanes, trucks or railroads.
Freight forwarders typically arrange cargo movement to an international
destination. Also referred to as international freight forwarders, they have the
expertise that allows them to prepare and process the documentation and
perform related activities pertaining to international shipments. Some of the
typical information reviewed by a freight forwarder is the commercial invoice,
shipper's export declaration, bill of lading and other documents required by the
carrier or country of export, import, or transshipment. Much of this information is
now processed in a paperless environment.
Custom clearance-
It is a procedural activity which is performed by government personnel. The
shipment has to clear all the norms of custom clearance. Custom clearance differs
from country to country. Tariff classifications, value declaration, and duty
management can increase costs. Customs and security initiatives have imposed
new regulations on companies that make it more challenging than ever to trade
internationally

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Transportation- It is the movement of people and goods from one location to
another. Transport is performed by various modes, such as air, rail, road, water,
cable, pipeline and space. Infrastructure consists of the fixed installations
necessary for transport, and may be roads, railways, airways, waterways, canals
and pipelines, and terminals such as airports, railway stations, bus stations,
warehouses and seaports.
Documents requirement for air / sea freight import
Documents No. of copies
P. O. 1
Shipping Instructions 1
Commercial Invoice 2
Packing List / Packing Slip 2
HAWB / HBL 2
M.S.D.S. (in case of D.G. / Non D.G., chemical products) 2
In case of D.G. : to obtain UN class number from shipper and
accordingly make the shipment booking with airline / shipping line 1
Documents No. of copies
HAWB / HBL 1
Commercial Invoice 1
Packing List / Packing Slip 1
Copy of P. O. 1
Original Certificate of Origin 1
Drawing / Product catalogue / Technical write-up 1
M.S.D.S. (in case of D.G. / Non D.G., chemical products) 1
In case of D.G.: UN class number from shipper. 1

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Documents requirement for export by air - clearance and
forwarding
Documents No. of copies
Shipping Instructions 1
Commercial Invoice 5
Packing List / Packing Slip 5
SDF form 2
ARE1 / ARE4, C. Excise gate pass 2
N Form 4
M.S.D.S. (in case of D.G. / Non D.G., chemical products) 2
In case of D.G. : to obtain UN class number from shipper and
accordingly make
the shipment booking with airline / shipping line 1
Documents requirement for export by sea -
FCL (factory stuffing) - clearance and
forwarding
SDF form 2
ARE1 / ARE4, C. Excise gate pass 4
N Form (if applicable) 2
M.S.D.S. (in case of D.G. / Non D.G., chemical products) 2
C. Excise examination report on back of invoice. (in case of
LCL, the same is not required) 5
Packing List / Packing Slip 2
Note : Ensure that customer holds the valid Factory
Stuffing Permission for FCL factory stuffed
containers
Post shipment export documents
Original set of Bill of Lading OR sea waybill / AWB (as the
case may be) 1
Customs attested Invoice and Packing List 1
Customs attested SDF form 1
Original copy of Shipping Bill 1
Customs attested ARE1 / ARE4 1
EP copy of shipping bill 1

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Terms:-
FCL:- Full Container Load:- Standard (twenty or forty-foot) container that is
stuffed (loaded) and un-stuffed (stripped) under the risk and account of
the shipper or consignee. In general, a FCL container attracts
lower freight rates than an equivalent weight of loose (break bulk) cargo. Also
called full trailer load (FTL).
LCL:- Low Container Load:- Shipping term for cargo that is insufficient either
in quantity or in weight to qualify for the freight rates applied to
a standard shipping container. These can be clubber with other cargo.
Stuffing: - Process of filling in containers.
Loading: - Process of Loading from container to vessel.
Sailing: - Movement after Loading
Benefits with Licenses by DGFT
1. DEPB
Duty Entitlement Pass Book Scheme in short DEPB is an export
incentive scheme. Notified on 1/4/1997, the DEPB Scheme consisted of (a)
Post-export DEPB and (b) Pre-export DEPB. The pre-export DEPB scheme
was abolished w.e.f. 1/4/2000. Under the post-export DEPB, which is issued
after exports, the exporter is given a duty entitlement Pass Book Scheme at

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a pre-determined credit on the FOB value. The DEPB rates is allows import
of any items except the items which are otherwise restricted for imports.
Items such as Gold Nibs, Gold Pen, Gold watches etc. though covered under
the generic description of writing instruments, components of writing
instruments and watches are thus not eligible for benefit under the DEPB
scheme.
2. Advance license:-
An advance license is granted for the import of inputs without
payment of basic customs duty. Such licenses shall be issued in accordance
with the policy and procedure in force on the date of issue of the license and
shall be subject to the fulfillment of a time-bound export obligation, and value
addition as maybe specified. Advance licenses maybe either value based or
quantity based. It’s given only for raw material imports with the condition that
the product produced won’t be used for final consumption.
3. EPCG License:-
Applies to machinery import and built units. Certain duty benefits
are provided. Condition being that eight times of the worth of product
imported must be exported.

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Benefits without Licenses
100 % Duty Draw back scheme is applied to Export oriented units. The fund
directly gets transferred to the respective account.
Representation showing the role of Freight Forwarders (F.F) at various steps:-
Note: - Above diagram is just a schematic representation. The actual process
involves many more sub processes, parties & terms
Manufacturer/
Shipper
Transporter Carting Custom Clearance
Sailing or Flight Loading
Stuffing / Palette
Clearing Agent
D.O IssueIGM Filing
Sea + Air
Vessel Arrival
Cargo Arrival
Notice or
intimation to
the consignee
Custom Clearance
Duties
Transport &
Delivery.
Trans shipment
Consignee
F.F
F.F
Factory Sealing/
Custom Sealing
F.F

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Some Common Problems Faced
1. Documentation Problem: - Problems like missing documents, printing
mistakes etc.
2. Custom Clearing Problem: - Product classification confusion, Value limits
confusion.
3. Shutout Problem at Loading: - Official stay on further procedures in last
moment.
4. Vessel Bypass: - Due to delay caused, vessel may miss the port.
The Marketing Mix:-
1. The Service:- Channel Freight provides services to well known corporate
brands like
Additional Services provided include Door Delivery, Storage, Clearing Agent,
Insurance Assistance, Certificate of Origin etc.

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2. The Price: - There are no fixed prices due to huge variations in product
types involved. The prices vary on basis of volume vs weight depending
on product category. Further there are even more variation on basis of
Air & Sea freight. In order to tackle these pricing variation a standard
calculation methods are used.
➢ Sea Freight:-
For LCL: - Minimum charges is based on rates for one cubic meter.
Maximum charges is calculates as one cubic meter is equal to one
Metric ton.
For FCL: - on basis of the Contents per Container.
Volume Calculation: - Length x Breadth x height = come.
1,00,000
Weight Calculation: - Length x Breadth x Height = Kg
6000(1,00,000/166.66)
Rates are thus charges on whichever is higher volume v/s weight. E.g. - For
products like mercury volume occupied is very less, but weight is high. While for
cotton volume is high but weight is less.

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➢ Various types of charges involved :-
SEA Freight
❖ Ocean Freight (varies according to destination)
❖ Terminal handling charges ( THC)
❖ Bill of Lading fees & documentation charges
❖ Service tax.
AIR Freight
❖ Air Freight
❖ Fuel Surcharge
❖ Security Surcharge
❖ X Ray Scan charges
❖ Carting
❖ Miscellaneous
3. The Place/Distribution: - The office is strategically located very close to
Dighi where major activities of customs, packing & transportation takes
place. Channel Freights have tied up with local transport agencies for
transportation of client’s products to Mumbai. Apart from this
Warehouse & Cold storage facilities are also provided.
Varies from Airline to Airline

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4. The Process:- Channel freight follows unbeatable process to satisfy the
clients to their fullest. The documentations are handled efficiently.
Customers are regularly updated about their consignment status. Apart
from this efficient use of technology is done, e.g.: - use of internet to
track the shipment 24 X 7.
5. The Promotion: - The promotion of the services is done through
marketing executives specially appointed. Also they have a firm
presence on internet through B2B portals & classifieds. Also good
relations the various agencies involved like transports, agencies,
warehouses etc aids promotion.
6. The People: - Channel Freight has some of the finest & competitive staff.
Also the list of satisfied clients is large. Their unmatchable service &
expertise has led to the success of this organization.
7. The Physical Evidence: - As a part of promotion Channel freights has
presence in local classifieds, truck hoardings etc. Also Visiting cards &
brochures provide enough physical evidence.

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Findings:-
Test of Hypothesis:-
➢ Freight Forwarders act just like an agent and don’t take any title or risks
w.r.t the client’s goods.
Finding: - True. The study Cleary shows that freight forwarders act just as a
facilitator to their client to conduct the procedures. This eases the
herculean task the client would have to face in absence of F.F.
➢ Freight Forwarders don’t require marketing, as they handle products of
their clients.
Finding: - False. The immense competition that exists is rightly portrayed by
the above study. Hence Marketing becomes absolutely essential for the
freight forwarders.
Limitations:-
➢ Time: - Conducted on a part time basis, I feel that the effectiveness of the
study could have been more if conducted on full time basis.
➢ Novice Researcher: - This fields were totally new to me, hence there may
be some errors. But earnest effort has been made to eliminate any kind of
errors and provide genuine knowledge.

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➢ Technology can play a very important role in enhancing the operations.
Constant updates to the clients about the consignment status can be sent
through SMS services.
➢ Internet Marketing is another area which can be utilized to promote the
services. (SEO, Affiliate Marketing, Google Advertising services etc.)
The freight forwards are an essential entity in international business operations.
They have immense knowledge about the vicissitudes of this business and are
the right people to tap for help by the clients going global. Further they also
provide value added services that eases the process.

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Books:-
1) International Logistics
By Devid Pierre
2) International Trade and Export Management
By Francis Cherunilam
3) Export Import Procedures and Documentation
Dr.Khushpat S.Jain
Presentation:-
Presentation by CII (Confederation Of Indian Industries)
Research Report:-
MARKET POTENTIAL OF FREIGHT FORWARDING BUSINESS
By: - JAIMANGAL MAURY
Referred website
1) www .impact-logistics.in
2) www.indiamart.com
3) www.google.com
4) Wikipedia.com
5) Yahoo.com
6) Investopidea.com

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