Academic journal article Journal of International Technology and Information Management

An E-Logistics System for Sea-Freight Forwarding

Academic journal article Journal of International Technology and Information Management

An E-Logistics System for Sea-Freight Forwarding

Article excerpt

INTRODUCTION

The shipping logistics chain involves a number of parties including the shippers, local freight forwarders, co-loaders, carriers, overseas freight forwarding agents and consignees. As the middlemen in the supply chain, freight forwarders provide assistance to shippers throughout the process. The related operational tasks in the overall freight industry must also be efficiently executed if benefits along the supply chain are to be realized. Changing conditions and aggressive competition compels forwarders to constantly search for cost savings, both as an industry group and as individuals. Investment in and adoption of IT has consequently become an essential element in achieving efficiency and effectiveness in today's global logistics (Hakker, Trick & Sabki 1994; Lewis & Talalayevski, 2000; Sum, Teo, & Ng, 2001; Stone, 2001; Lai, Wang & Zhao, 2006; Lai, Zantow, Li, & Wang, 2008).

Hong Kong has become the major transportation and logistics hub for South China and for a good part of Asia. For many years, Hong Kong has maintained its leading position as one of the world's busiest container ports. The growth in air cargo has also established Hong Kong as a major international air cargo handling centre. To strengthen Hong Kong's position as a logistics hub, the local Authorities have invested heavily into the related infrastructure and supporting services, which includes customs clearing procedures, seaports and airport developments, and the warehousing and storage facilities required by the forwarding industry. This has resulted in a substantial growth in the number of freight forwarding companies in Hong Kong; in December 2009, there were 1040 and 2253 companies providing air cargo and sea cargo forwarding services respectively, employing a total of 38,000 workers (Census and Statistics of Hong Kong, 2009). The majority of these freight forwarders are classified as small to medium-sized enterprises (SMEs) employing less than 50 workers. While the larger freight forwarders are able to invest in IT and provide other logistics-related value-added services to transform into third-party logistics (3PL) service providers, most SMEs still rely heavily on human effort and experience in planning their daily operations. For instance, many SME freight forwarding companies used to finalize paper documentation after shipments had left. However, such practices are no longer able to meet the clearance rule and the recently introduced Importer Security Filing "10+2" requirement for inbound US containers as required by US Customs. This kind of ever-expanding and exacting needs of customers and governments makes it necessary for freight forwarders, large and SMEs alike, to make use of the state-of-the-art IT to support their logistics operations and to provide speedy and reliable services to shippers. To establish an IT infrastructure to promote efficient global trade and logistics, the Hong Kong government has launched the first phase of the DTTN (Digital Trade and Transportation Network) system. DTTN (http://www.hk-dttn.com) is going to offer a neutral e-platform to facilitate the exchange of information and data to the trading, logistics and related communities.

This paper describes the development of an e-logistics system for a sea freight forwarder in Hong Kong. The system exploits web-based technology to provide data support for the physical operations and also to facilitate data exchange between freight forwarders. The e-logistics system developed provides: (1) an e-booking platform for shippers and forwarders that is capable of proposing an economic shipment route electronically, and which facilitates the exchange of shipment cargoes information among the forwarders by establishing an electronic cargo exchange market; (2) a decision support system for solving the container selection and cargo allocation problem for the sea-freight industry; and (3) a facility for the exchange of shipment information between participants in the shipping business using the XML standardized data formats. …

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