Assignment Report on

Study of the Profit Improvement Opportunities available to Midsized Logistics Company (Alliance Shipping And Logistics (ASL)

Submitted By

K. Somasekhar 1226115117
P.Gopal
1226115130
Amulya
1226115142
Bibin Thomas

1226115105

B.Prasanth

1226315101

Puneeth

1226315113

Under the Guidance of

M.Subramanyam
Professor Corporate Finance
Chairperson: Admissions
International Business & Strategy
Gitam School of International School

Objective:
The main object of the study is to study the profit improvement Opportunities available to
Alliance Shipping And Logistics (ASL)
Introduction
Logistics encompasses all of the information and material flows throughout an
organization. It includes everything from the movement of a product or from a service that
needs to be rendered, through to the management of incoming raw materials, production, the
storing of finished goods, its delivery to the customer and after-sales service (Pollitt, 1998).
The scope of logistics has changed since the emergence of new technologies and strategic
alliances in order to compete on flexibility and responsiveness. The growing importance of
logistics arises from companies becoming globalized to gain access to new markets, realize
greater production efficiencies, and tap technological competencies beyond their own
geographical borders (McFarlan, 1984; Bovet, 1991; Cooper, 1993; Fawcett et al., 1993). A
reduction in trade barriers and the emergence of advanced technologies have led to a great
interest in logistics in recent years. Currently, logistics operations include purchasing,
distribution, the managing of inventories, packaging, manufacturing, and even customer
services (Bowersox and Closs, 1996).
In todays highly competitive environment, many companies are aiming to gain a share of the
global market and to take advantage of higher production and sourcing efficiencies. A key
determinant of business performance nowadays is the role of the logistics function in
ensuring the smooth flow of materials, products and information throughout a companys
supply chains (Sum et al., 2001). More recently, logistics has become more prominent and is

recognized as a critical factor in competitive advantage (Bowersox and Closs,1996;

Bowersox and Daugherty, 1995; Christopher, 1992). The logistics operations process includes
the inputting, storing, transporting and distributing of physical goods.
Over years, logistics has developed from single-party logistics (self-managed) to 5PL (multiparty), using e-logistics networks focusing on global operations. 3PL is contractual logistics
focusing on regional operations.
The main objectives behind the outsourcing of logistics services are to:

. Reduce operating costs;

. Meet demand fluctuations; and
. Reduce capital investment.

The general problems that arise in corporate logistics include delayed and inaccurate
information, incomplete services, slow and inefficient operations,and a high product damage
rate. The possible consequences are an inability to provide inter-linked services, high
operating costs, a rate of high inaccuracy, and a lack of flexibility in responding to changing
demand requirements.A number of researchers have examined logistics issues in a global
perspective, including Fawcett et al. (1993), Gary and Davies (1991), Quinn and Hilmer
(1994), Welch and Nayak (1992) and Wyatt (1992). The integration of logistics with other
functional areas will help bring a company to realize the full potential of its value-added
activities and, hence, to gain a significant competitive advantage. It will also lead to a
reduction in operational costs and an improvement in customer services (Christopher, 1989;
Richardson, 1995).
E-logistics and the outsourcing of logistics business processes are subsets of a larger external
logistics market. E-logistics can be defined as the transfer of goods and services using
Internet communication technologies such as electronic data interchange (EDI), e-mail and
World Wide Web (WWW). The supply chain is an integrated business model for logistics
management. It covers the flow of goods from suppliers through manufacturing and
distribution chains to the end consumer. Christopher (1992) argued that the real competition
is not company against company, but rather supply chain against supply chain. In recent
years, information systems (IS) are increasingly being regarded as resources that support
various business processes (Alshawi,2001).
Aldin and Stahre (2003) presented a conceptual model (see Figure 1) for logistics supply
chain management, with a special focus on 3PL.
This model consists of three major components:
(1) logistics structure;
(2) logistics processes and related activities; and
(3) information and reporting systems.

All three components are essential for a successful 3PL operation. Logistics structure
includes the participants in the logistics processes, inventory storage points, multi-echelon
distribution centers and warehouses. Logistics processes and related activities comprise order
fulfillment processes, customer relationship management, and customer service, and
procurement and demand management. Finally, information and reporting systems are
essential for any management system, as they drive the decisions based on the data collected.
These include the designing and planning of information systems, control and coordination,
and cross-organizational coordination. IT such as the intranet, extranet, Internet, WWW and
EDI facilitate the integration of activities in the logistics supply chain (Angeles, 2000; Calza
and Passaro, 1997).

A 3PL model with five major dimensions has been proposed.

These are:
(1) strategic planning;
(2) inventory management;
(3) transportation;
(4) capacity planning; and
(5) information technology.
This model has the objective of developing management control systems, resource
management systems and integrating logistics activities.

The details of the model are given in Figure . Managing a small 3PL company requires
strategic planning, which involves the making of long-term decisions concerning 3PL
operations. These decisions should include those on corporate strategy such as the nature of
the logistics business (e.g. transportation, warehousing, etc.), the location of distribution
centers, outsourcing, the size of the business, and the budget for running the logistics
business. Inventory management includes planning, coordinating and controlling of materials
flow along the logistics supply chain. The major decisions should involve the volume and
timing of orders and deliveries, and the packing of items in batches (consolidation). There are
several constraints influencing the level of stock and the speed of the material flow along the
logistics supply chain. The level of stock and the speeds the material flow also depend upon
the nature of the supply and demand. Transportation or shipping involves such matters as the
modes of transportation, utilization of available capacity, scheduling of transportation
equipment and maintenance of transportation facilities. Next comes capacity planning. The
management of Management of a small company 831 both long-term and short-term demand
drives the level of capacity required. For example, long-term decisions should revolve around
issues such as the number of warehouses or distribution centers and their capacity; the
number of transportation vehicles and the capacity of the material handling equipment,
including the number of workers. These are, of course, driven by the demand for products
along the logistics supply chain. Finally, information technology or systems help to integrate
the activities in all of these areas by collecting the data on the performance and utilization of
resources and, based on this, making the required changes to the logistics operations. Various
types of IT can be used, including intranet, Internet and extranet, together with EDI, WWW
and enterprise resource planning (ERP). The use of IT also involves data mining and data
warehousing
Alliance Shipping And Logistics (ASL) spearheaded by Mr. Nekkanti Sridhar, who believes
in work with scales of economy with quality at forefront with 10 years experience in shipping

and cargo related activities and with the support of his tiered less and dedicated work force of
160 personal ASL could achieve a growth rate of over 200 percent every year.
Alliance Shipping And Logistics operates with a fleet of 25 Triple Axle Multipurpose Trailers
fitted with power packs, to carry reefer containers under temperature control. The fleet is also
used for moving the dry containers from and to the port with twin laden container carrying
facility the fleet has a carrying capacity of 40 to 49 tons per trailer. Our fleet of 3 fully
automatic Fork Lifts are used in CFS to stuff cargo into the containers.
Alliance Shipping And Logistics have established themselves as clearing and Forwarding
Agents for major shippers and with the shipping lines in India and have been liaising with
them in clearing the cargo.
Services:
Customs Clearance
Our customs experts will guide you to release your consignments within the free time limit.
Customs Documentation
Carting / Receiving goods
Examination of Shipments Handling of stuffing and de-stuffing at ports and warehouse.

Door to Door Logistics

We have a unique intermodal transport system to help our customers to reach to its end
destination in a smoother way.
Transport of goods with trailers
Transport of trailers and over-dimensional goods
Transport of goods in reefer containers

Air Our freight services are managed by our executive who will arrange to provide the best
competitive rates in the market.
Sea We have a wide experience in sea freight forwarding . We offer both FCL and LCL
services with a wider choice of ocean carriers

Stevedoring

We have a smoother supply chain, which helps the customers to increase efficiency in
procurement of goods. With more than 10 years of experience in the logistics industry, ASL is
fully committed to deliver top quality logistics services to its customers.
Warehousing
We can handle all your warehousing and distribution needs at reasonable rates.
Project Logistics
ASLs Project Logistics has a integrated global network which includes the transport of heavy
lift and out of gauge cargo for capital projects. We also have a team of logistics experts to
plan all stages of the project cycle.
Hydra Crane
ASL has fleet of Four Hydra Cranes,working continuosly for loading and unloading cargo for
various export-import cargo packed in jumbo bags.
Trailers
ASL also has a fleet of 25 Triple Axle Multipurpose Trailers fitted with power packs, to carry
reefer containers under temperature control. The fleet is also used for moving the dry
containers from and to the port with twin laden container carrying facility the fleet has a
carrying capacity of 40 to 49 tons per trailer.
Forklift
ASL also has a fleet of 3 fully automatic Fork Lifts are used in CFS to stuff cargo into the
containers.
Profit Improvement Opportunities available to Mid-sized logistics company ASL
Visakhapatnam: Visakhapatnam is fast turning into a logistics hub with several
container freight stations (CFS) looking at the port city to set up their offices. The state
government has also decided to market the port city as a major logistics hub in the state.
According to sources, at least six CFS projects, warehousing complexes and multi-modal
logistics parks are in various stages of establishment in and around the city.
About 400 acres of land has already been identified at Anakapalli for logistics. The AP
government and the Visakhapatnam Port Trust are jointly executing the project. A detailed
project report is being prepared. It will be ready by this month end. However, the government
will take a final call on the role it will play in the logistics hub.

Three different projects are also being planned by Sravan Shipping Services at different
locations in the city. They are CFS, free trade warehousing zone-cum-logistics park and
logistics-cum-warehousing complex.
Visakha Container Terminal Private Limited (VCTPL) is establishing a container freight
station with an estimated investment of Rs 60 crore on a parcel of land provided by
Visakhapatnam Port Trust (VPT). The VCTPL is expected to be launched later this month.
The Container Corporation of India (Concor) is also developing a multi-modal logistics hub
on 100 acres with an investment of Rs 372 crore. Also, a joint venture multi-modal logistics
hub is being undertaken by VPT in association with Balmer Lawrie and Co Limited. It is
investing around Rs 211 crore in the city.
"Many logistics providers are preparing for the future requirements by making investments
now. There is no doubt that container cargo will increase in the coming years once new
industries start coming up in the region," said a shipping industrialist. With the expansion of
the container terminal at VPT, the capacity at the terminal will increase to 0.9 million tonnes.
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Visakhapatnam
is fast turning
into a logistics
hub

Three different projects

are also being planned
Sravan Shipping
Services at different
locations in the city

Concor)
Profit Improvement
is also developing
Opportunities
a multimodal
available
logistics
to Mid-sized
hub on 100logistics
acres
company
Rs 372ROAD
crore
Trainwith an investment
SHIP ofASL

VCTPL)is establishing
a container freight
station with an
Freight &
estimated investment
Logistic Investors
of Rs 60 crore
in
AirVisakhapatnam