1. Introduction
One
of the challenges Indian coastal shipping faces is the non-availability of
return cargo. Cargo consolidation or LCL (Less than Container Load) shipments could
be a viable and economic solution for the cargo flow imbalance currently
plaguing the sector. Consolidation is the process of combining various small
parcels into one unit in order to realize lower transportation rates. This
system is effectively utilized by the customers in the international container shipping
sector.
The
domestic consolidated cargo sector is currently been monopolized by the road
traffic. A combination network of
‘Road-Rail-Coastal Shipping-Road’ could be effectively used to provide an
economic and efficient door-to-door transportation solution for domestic LCL
traffic. Intermodal logistics has tremendous potential to increase supply chain
efficiencies of the country.
2. Suggested procedure
for domestic LCL shipment
At
the place of origin (eg.Delhi ), the individual parcels of cargo could be
collected from the customers by truck/van and brought to a CFS / warehouse for
consolidation. The stuffed containers could then move to the gateway port (eg,
Mundra, Pipavav) by way of rail /or road and to be shifted to the coastal ship
for the long leg haul to the destination port (eg, Cochin ,Tuticorin) . The
process could be reversed at the port of destination and at the final place of
delivery (eg , Kollam , Thirunelveli).
Fig:1
Integrated
Transport Model for LCL Containers
However,
an expected bottle neck in this process would be the first/last mile
connectivity and consolidation /break bulk of cargo. And the suggested solution to this issue is a
logistics system based on milk-run concept which is explained here under.
2.1 Model for First and Last Mile Connectivity
A
Milk Run in logistics is a round trip that facilitates both distribution and
collection at the same time. By making frequent stops, a truck can pick up many
types of materials originating from several suppliers and drop off goods
destined for various customers, all in the same run. This allows direct
pick-ups and drop-offs to be planned more frequently, without having to wait
for full truckloads. This method is successfully implemented in
many industries for accelerating the flow of products between various
production processes by planning truck routes in such a way that they collect
and deliver materials for many different processes at once.
Fig:2
The
Milk Run Concept in Logistics
2.2 Procedure for Milk-Run
The
procedure for this concept in logistics consists of fixing
-
Proper
route and schedule
-
weight
and volume of parcels collected/distributed at both ends
-
delivery
frequency, time slots, maximum number of customers included etc.
While
setting the procedure, priorities must be given to the customer needs rather
than the operator’s comfort. To begin with, the Multimodal Transport Operators
(MTO) could work out a joint operation with the locally available distributers
such as courier services, newspaper distributors, packaged food distributers etc
for the collection and distribution of parcels. This could be advantageous for
both the parties. Once sufficient volume
is build up, the MTO can set up his own system.
For
the visibility and traceability of the supply chain a one stop-shop, such as a
single electronic window, which integrates the administrative processes,
timetables and invoices etc covering the whole intermodal chain, should be
established to make it more customer friendly.
3. Suggested Pilot Study
Kerala,
being a consumer state, depends on other states for meeting with most of its day
to day requirements for all kinds of commodities. These commodities are
presently moved by road. A pilot study
could be carried out by networking the existing non- major ports which are
fairly connected with road, rail and inland waterways.
A
short summary of goods moved in to/from Kerala is given here under.
a. Food Items : Kerala consumes large volumes
of rice , wheat, atta, biscuits,
chocolates, ground nuts, soft drinks, edible oil, mineral water, liquor and
beer, branded food items, milk powder etc and at present it is being moved by
road. There is scope for exploring the possibility of these commodities being
moved by coastal shipping in LCL mode.
b. White Goods: These products include items such as
refrigerators, computers, plastic goods, bicycles, TV/VCD / DVD players, fancy
goods, gifts articles, glassware, kitchen products, motor vehicles, telephone,
washing machines and related spares / equipment. These goods get moved mainly
from Delhi, Noida / Gurgaon, NCR, Maharashtra, Gujarat and Tamilnadu region and
are currently being moved by road.
c. Vegetable and Fruits: Vegetables like potato, onion, garlic
are mainly procured from Maharashtra. Approximately Kerala consumes onion,
potato and garlic together around 1 lakh tons per day. These are also moved by
road currently.
d. Industrial Goods: Goods like spares, parts for
automobiles, chemicals, polymers and acids, packing cases, bags, etc. are
mainly procured from Tamil Nadu, Karnataka and Gujarat and is getting moved by
road.
e. Other General Goods: These goods include paints,
medicines, polythene, pipes and fittings, books, tins, cables, generators,
glass surgical equipment etc are procured from Tamil Nadu, Karnataka,
Maharashtra, Goa, and Gujarat. These are being moved by road.
f. Spices, Cashew,
Coconut, Coir, And Natural Rubber: These are the products moving out of Kerala
to other states and are also moved mainly by road at present.These products
have major domestic markets in Tamil Nadu, Andhra Pradesh, West Bengal, Delhi
and NCR. These are also potential cargo for the LCL business.
As
per estimates, around 20,000 trucks bring goods into and another 2000 are
carrying goods from Kerala every day.
These commodities which are presently moved by road could be
consolidated and stuffed in containers and moved by coastal shipping wherever
possible.
4. Create awareness to promote mode shift
There
is absolutely no doubt that an automatic shift from road to water transport
system will not be possible. Generally, the shippers’ transport mode choice
depends mainly on benefits of transport services such as cost, frequency,
reliability, flexibility etc . The reasons for shippers to switch
modes/operations have not been effectively demonstrated or communicated to
them. Coastal shipping could be considered
by shippers as a viable option only if it is proven through high-visibility
demonstration projects and studies.
Awareness
needs to be created among users on the benefits of coastal shipping as well as
integrated multi-modal service models.
Customer Support centres should be opened at all ports, ICD/CFS and at
economic clusters jointly by state maritime boards / IWAI/ INSA etc to create
awareness among the shipping community and also to clarify their doubts and
support them with required information.
Awareness
programmes should be organised to promote coastal shipping sector and also to
familiarize with the latest customs /port procedures with an overall objective
of promoting intermodal solutions. The facilities of local Steamer Agents and
Custom House Agents’ Associations should be utilised for organizing periodical
trainings /conferences and troubleshooting workshops. Also, success stories in
this sector should be advertised.
Intermodal
logistics has tremendous potential to increase supply chain efficiencies of the
country. The right policy incentives from the government and business interests
from the private sector should work hand in hand to spur growth in this sector.
The Central and State Governments’ innovative initiatives to promote coastal
shipping also expected to promote inter-modality into a competitive and
economically viable reality.
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