Transaction elements

According to (Stock & Lambert, 2001), transaction elements

means elements directly related to the physical distribution
function.
They include the following:
1. Stockout level
2. Order information
3. Elements of the order cycle
4. Expedited shipments
5. Transshipment
6. System accuracy
7. Order convenience
8. Product substitution

1. Stockout level
Definition: Is a level to measure of product availability.
Stockouts occur,
1) arranging for suitable product substitution
or
2) expediting the shipment

1. Stockout level
Elimination of Tariffs.
-Eliminate import duties on all intra-ASEAN goods, except sensitive
and highly sensitive products.
-This means that zero tariff -> goods can be produce in everywhere
without hide -> increase the stockout level.
Elimination of Non-Tariff Barriers.
ASEAN has achieved tariff liberalisation -> no restrictions of tariff and
quota -> products easy to move -> increase the stockout level.

2. Order information
Definition: Ability to provide accurate and fast information
such as
1) order status, 2) inventory status, 3) expected
shipping
and delivery dates, and 4) back-order status to
the
customer.
Back-order capability enable the firm to determine and
facilitate orders that need immediate attention.
Number of back-orders is to measure performance of system.

2. Order information
Trade facilitation.
Simple, harmonised and standardised trade and customs,
procedures,
processes and related information flows (for example: order
information) to reduce transaction costs in ASEAN.
ASEAN Single Window.
National Single Window allows a single submission of data and
information, a single synchronous processing of data and
information
which can reduce transaction time and costs.

3. Elements of the order cycle

Definition: Total time that pass from initial order of customer
until
delivery to the customer.
The components of the order cycle include
1) order communication
2) order entry
3) order processing
4) order picking and packing
and
5) delivery

3. Elements of the order cycle

Free Flow of Services
-Eliminate substantially all restrictions on trade in services for 4
priority services sectors, e-ASEAN, healthcare, air transport and
tourism, by 2010 and the fifth priority services sector, logistics
services, by 2013.
-Let foreign (ASEAN) equity participation for the 4 priority services
sectors, logistics services and other services sectors of not less
than
49% by 2008 until 2015.

4. Expedited shipments
Definition: Those that accept special handling in order
to reduce the
normal order cycle time.
Even though expediting costs quite more than standard
handling, but it cost less than losing a customer.

ASEAN single market

A single market for goods and services will
1) promote the development of production networks in
the region
2) improve ASEANs capacity to serve as a global
production centre or
global supply chain

Effect of ASEAN Single Market to

foreign workers
Malaysias migrant workers become one of the highest in
ASEAN next to Singapore.
22% of the Malaysian labour force consists of foreign workers.
This is dominated by unskilled and low skilled workers
(Orbeta, 2013).
Foreign workers tend take on jobs that local workers no
longer prefer to do especially low-paying jobs in sectors such
as domestic services, construction, agriculture, fisheries, and
manufacturing (Rynhart & Chang, 2014).
Foreign workers compete with local workers.

Effect of ASEAN Single Market to

local workers
Shortage of local workers in labour-intensive sectors
such as the garment industry and followed by rises in
labour costs (Orbeta, 2013).
More local workers Immigrant to other country to search
of better opportunities in a globalized labor market
(Kanapathy, 2007).
The common destination are the US, UK, Australia,
Canada, New Zeland and Singapore (Rynhart & Chang,
2014).

5. Transshipment
Transport of goods from one place to another places to
avoid stockouts. It places at intermediate destination,
then to yet another destination.
Are often made in anticipation of customer service.
Transshipment usually take place in transport hub,
much international transshipment also take place in
designated customs areas.

5. Transshipment
Since ASEAN Economic Community adopted the ASEAN
single market, it was facilitate the transport of goods
between ASEAN members, thus it is huge benefit
among them.
Free flow of goods mentioned in core element of ASEAN
single market;
zero tariff and removal non tariff barrier..
Trade facilitation,
Customs Integration- smoothen custom clearance.

 Political aspect
Strengthening Cooperation under the Cooperation in Southeast Asia
Promote ASEAN Maritime Cooperation
i.
ii.

Establish the ASEAN Maritime Forum;

Apply a comprehensive approach that focuses on safety of navigation and
security concern in the
iii. region that are of common concerns to the ASEAN Community;
iv. Stock take maritime issues and identify maritime cooperation among ASEAN
member countries;
v. Promote cooperation in maritime safety and search and rescue (SAR)
through activities such as
vi. information sharing, technological cooperation and exchange of visits of
authorities concerned.

6. System accuracy
The accuracy of quantity ordered, product ordered, and
billing.
Is important to both the manufacturer and the
customer.
Errors should be recorded and reported as a percentage
of the number of orders handled by the system.

6. System accuracy
ASEAN Single Window.
Enables a single submission of data and information, a
single and synchronous processing of data and
information
Single decision-making for customs clearance of cargo,
which expedites the customs clearance,
Reduce transaction time and costs, and thus enhance
trade efficiency and competitiveness.

 Consumer Protection
Consumer protection measures are already being developed
in tandem with the proposed economic measures to address
the already emerging consumer protection.
i.

Strengthen consumer protection in ASEAN through the

establishment of the ASEAN Coordinating Committee on Consumer
Protection (ACCCP);
ii. Establish a network of consumer protection agencies to facilitate
information sharing and exchange;
iii. Organize regional training courses for consumer protection officials
and consumer leaders in preparation for an integrated ASEAN
market.

7. Order convenience
Refer to the degree of difficulty that a customer
experiences when placing an order.
Problem that result from confusing order forms or
nonstandard terminology can lead to poor customer
relations
An appropriate performance measurement is the number
of convenience-related problem as a percentage of the
number orders.
These problem can be identified and reduced or
eliminated by conducting field interviews with customers

8. Product substitution
Substitution occurs when the product a customer ordered
is replaced by the same item in a different size or by
another product that will perform as well or better.
In order to develop an appropriate product substitution
policy;
the manufacturer should work closely with customers to
inform them or gain their consent.
Keep product substitution records to monitor performance.
Requires good communication between the manufacturer
and customers.

8. Product substitution
ASEAN single window
Since it was developed, it has simplified the
communication between two parties (manufacturer &
customer) and product substitution program will be
successful by the application of ICT in all areas related
to trade facilitation. For example ASEAN-6, ASEAN-4
The implementation of measures of simplifying,
harmonising and standardising

Effect ASEAN single market to

foreign workers
The AEC (ASEAN Economic Community) will have major
benefits for the Philippines.
Increasing migrant workers in the countries.

Effect ASEAN single market to local

workers
Some communities and even whole countries may lose out
because of the risk of human rights being sacrificed to the
imperatives of big business.
Local workers are needed to upgrade skills to meet shifting
demand, since AEC will increase the demand for skilled labor
across the region.
women will gain less from new jobs than men said Sukti
Dasgupta, Senior Economist at the International Labour
Organisation.
creating wage inequality between skilled and unskilled
workers

References
Gattorna, J. L. (1990). Handbook of Logistics &
Distribution Management. (G. Trost, Ed.) (4th ed., pp.
6676). Burlington: Gower Publishing Company.

References
Kanapathy, V. (2007) Highly-skilled versus low-skilled labout
migration: Managing a complex agenda in Malaysia, Paper
prepared for EADN Migration Project.
Orbeta, A. C. (2013). Enhancing Labor Mobility in ASEAN: Focus
on Lower-skilled Workers, 121. Retrieved from
http://dirp4.pids.gov.ph/ris/dps/pidsdps1317.pdf
Rynhart, G., & Chang, J. (2014). No Title (pp. 158). Retrieved
from
http://www.ilo.org/public/english/dialogue/actemp/downloads/pu
blications/working_paper_n7_en.pdf

References
Stock, J. R., & Lambert, D. M. (2001). Strategic Logistics
Management. (R. Adams & C. Parker, Eds.) (Fourth., pp.
95143). New York: McGraw-Hill Irwin.