INDIA – KENYA OCEAN ROUTE DEVELOPMENT

Guided By:

Prof. Rajiv Sathe

Compiled By

GROUP 10

Khyati Jain (09020241014)

Samarth Gupta (09020241026)

Vishal Singla (09020241048)

Saumil Joshi (09020241097)

Agenda

•Trade Route•Market Analysis•HR Requirements & Training•Advertisement•Shipping Lines•Freight rates•Profit Projections•References

India-Kenya Ocean Route

Where are we.

•Trade Route

•Market Analysis•HR Requirements & Training•Advertisement•Shipping Lines•Freight rates•Profit Projections•References

Year Period Export(in Rs.lacs)

2005-2006 1 191,6942006-2007 2 255,255

2007-2008 3 595,255

2008-2009 4 635,609

2009-2010 5 614,088

2010-2011 6 689,242

2011-2012 7 8572502012-2013 8 9602302013-2014 9 10632102014-2015 10 11661902015-2016 11 12691702016-2017 12 13721502017-2018 13 14751302018-2019 14 1578110

Total Market size

0 1 2 3 4 5 6 70

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

f(x) = 102988.383142857 x + 136397.837333333R² = 0.802886209238444

Time Period

Volume

Market size

Top 10 India to Kenya Kenya to India

1 Minéral fuels, oils, distillation Product, Bituminous substances, mineral waxes

Inorganic chemicals, precious metal compound, isotopes

2 Nuclear reactors, boilers, machinery, and mechanical appliances

Salt, sulphur, earth, stone, plaster, lime and cement

3 Pharmaceutical products Coffee, tea, mate and spices4

Electrical, electronic equipmentRaw hides and skins (other than furs kins)

and leather5

Iron and steelEdible Vegetables and Certain roots and

tubers6 Vehicles other than railway, tramway and

parts and accessories Lead and articles thereof7

Plastics and articles thereofWool, animal hair, horsehair yarn and

fabric thereof8

Articles of iron or steelVegetable textile fibres nes, paper yarn,

woven fabric9

Rubber and Articles thereofEdible fruit, nuts, peel of citrus fruit,

melons10 Aluminum and Articles thereof

Pearls, precious stones, metals, coins, etc

Commodities Moving

31%

23%

15%

11%

7%5% 3%2%2% 1%

Inorganic chemicals, precious metal compound, isotopes

Salt, sulphur, earth, stone, plaster, lime and cement

Coffee, tea, mate and spices

Raw hides and skins (other than furs kins) and leather

Edible Vegetables and Certain roots and tubers

Lead and articles thereof

Wool, animal hair, horsehair yarn and fabric thereof

Vegetable textile fibres nes, paper yarn, woven fabric

Edible fruit, nuts, peel of citrus fruit, melons

Pearls, precious stones, metals, coins, etc

Commodities Moving Kenya to India

51%

11%9%

8%

6% 5%

3% 3% 3% 3%

Minéral fuels, oils, distillation Product, Bituminous substances, mineral waxes

Nuclear reactors, boilers, ma-chinery, and mechanical appliances

Pharmaceutical products

Electrical, electronic equipment

Iron and steel

Vehicles other than railway, tramway and parts and accessor-ies

Plastics and articles thereof

Articles of iron or steel

Rubber and Articles thereof

Aluminum and Articles thereof

Commodities Moving India to Kenya

Mineral Products

Machines

Pharmaceutical products

Electrical appliances

Iron and steel

Vehicles

Plastics

Articles of iron or steel

Rubber

Aluminum

35.68

8.23

0.740000000000002

-20.44

-30.67

3.36

19.12

57.62

4.14

55.63Volume Based YOY Growth in each commodity Groups Moving India to Kenya

Inorganic chemicals

Salt, sulphur etc

Coffee, tea, & spices

Raw hides,skins, & leather

Edible Vegetables, roots & tubers

Lead

Wool, animal hair, yarn & fabric

paper yarn, woven fabric

Edible fruit, nuts, peel of citrus, melons

Pearls, precious stones, coins, etc

-22.15

59.74

18.85

18.56

454.58

-46.18

25.56

38.2

-80

22.88

VolumeVolume Based YOY Growth in each commodity Groups Moving Kenya to India

Top 10

India to Kenya Customers

1Mineral fuels, oils, distillation Product, Bituminous substances, mineral waxes

MMTC, GMDC, NMDC

2 Nuclear reactors, boilers, machinery, and mechanical appliances

Elecon, L&T, TATA International, BHEL, RIL

3Pharmaceutical products

Ranbaxy, Cipla, Dr. Reddy's., Aurobindo, Lupin, Atul Ltd., Sun Pharmaceuticals,

4Electrical, electronic equipment

Finolex,

5Iron and steel

Essar, Vedanta, Jindal, JSW

6 Vehicles other than railway, tramway and parts and accessories

Maruti, Bajaj, Honda, TATA Motors

7Plastics and articles thereof

Finolex, Plasiblends, AGA, ACRY+

8Articles of iron or steel

Aditya Birla, Essar

9Rubber and Articles thereof

GoodYear, Elgi Rubber, MM Rubber

10 Aluminum and Articles thereof Vedanta, Aditya Birla, TATA Exports, Hindalco

Major Customers in Each Commodities Group

Top 10

Kenya to India Customers

1 Inorganic chemicals, precious metal compound, isotopes

Apex Coatings, Kenya Fluorspar Co. Ltd, Orbit Chemicals

2 Salt, sulphur, earth, stone, plaster, lime and cement

Veitch International, Artioz Limited

3 Coffee, tea, mate and spicesMwango, Mukhashin , Exotic, Cola

4 Raw hides and skins (other than furs kins) and leather

Lordex Enterprises Kenya, ELLY Merchants

5 Edible Vegetables and Certain roots and tubers

Sunripe Ltd., East African Growers, Samawati Fresh, Value Pak Foods

6 Lead and articles thereofInsteel Limited

7 Wool, animal hair, horsehair yarn and fabric thereof

Danex Services Ltd,

8 Vegetable textile fibres nes, paper yarn, woven fabric

Ganesh, KHE, Frigoken Ltd, Rosecare Int.

9 Edible fruit, nuts, peel of citrus fruit, melons

Sunripe Ltd, Agrifresh Kenya

10Pearls, precious stones, metals, coins, etc

Pearl Kenya,

Major Customers in Each Commodities Group

• FedEx• UPS• Damco• DB Schenker

Competitors

DAMCO• Biggest Competitor• A global leader in freight forwarding and supply chain

solutions• Rich Experience of operating 120 countries• Dedicated India-Africa Lane• Services :

Ocean freight (dry and refrigerated) DDU and DDP Bases Solutions Specially for India – Africa Lane, Airfreight & Cargo insurance, CFS warehousing & trucking, Customs Clearance & Supply Chain Management

Competitors

Where are we.

•Trade Route•Market Analysis

•HR Requirements & Training•Advertisement•Shipping Lines•Freight rates•Profit Projections•References

Country Head(JP/IND)

Business Developmen

tSolution Design &

Implementation

Operations

Operations Manager

Labour

Supervisor

Route Developmen

t Manager

Organization Structure

Key Accounts Manager

Ocean Freight Trade Manager

Customer Service Coordinator

Warehousing/Freight Supervisor

HR requirements for the trade lane

Manager Route

Development

Manager international

logistic

Cargo and freight agent

Drivers and forklift/boom

operatorsInbound Out bound

Manager Service

Rejection Complain Returns

Organization Structure

Qualifications Generally, a minimum of five to eight years

experience in freight operations is required. Three years experience managing staff is required. Experience should include work in carrier relations

(including negotiating rates with carriers), managing against a P&L, an understanding of systems and databases, and strong analytical skills.

HR requirements to handle the trade lane

Must have extensive experience in working with customers – prior sales experience is a plus.

Proficiency in Microsoft Office suite of products is required. The ability to analyze rates and services of outside service

providers and make recommendation on use of proposed services is required.

Excellent oral and written communication skills are required. The ability to work in a fast-paced, dynamic work

environment is critical. Must be flexible and adaptive to changing work requirements

and work schedules.

Qualifications

Procurement/carrier relations (e.g., monitor trade lane requirements and capacity vs. supply; analyze opportunities to purchase bulk capacity; negotiate customer/network rates, maintain local/regional carrier relations; resolve various service issues; leverage carrier relationships to drive performance)

Costing and pricing (e.g., update pricing system, establish sell rates for customers, specify routing and sell rates to other SCS groups, conduct margin analysis by customer/trade lane, optimize container utilization, produce suggested sell rates for trade lanes, review rates for Federal Maritime Commission filings)

Major responsibilities

Contract administration (e.g., review and track contracts, monitor capacity purchases by origin port,negotiate contract modifications)

Process / procedure development/compliance (e.g., meet carrier/gateway usage targets, provide carrier and station problem resolution)

Negotiate contract modifications to accommodate market changes

Participate in strategy discussions with Business Development and Solutions

Expectations

Freight forwarding industry certification e.g., IMDG, IATA, CIFFA, and BIFFA

Training programs to enhance proficiency in English. If possible, proficiency in multiple languages

Trade Workshops to provide employees with the knowledge and tools they need to serve customers

Training of Employees

Where are we.

•Trade Route•Market Analysis•HR Requirements & Training

•Advertisement•Shipping Lines•Freight rates•Profit Projections•References

Advertisement

Where are we.

•Trade Route•Market Analysis•HR Requirements & Training•Advertisement

•Shipping Lines•Freight rates•Profit Projections•References

Maersk Line

India to East Africa - Masiika service The service rotation is as follows: Jawaharlal Nehru, India-----Pipavav, India---->Jebel

Ali,UAE-----Salalah,Oman-----Mombasa,Kenya-----Dar-Es-Salaam,Tanzania

This direct service from India to Kenya does not involve any transshipments.

Maersk Line

MSC

Offers direct service from Nhava Sheva-GTI and Mundra to Mombasa and Dar-E-salaam, Zanzibar and Tanga.

Also serves inland destinations in Kenya. Also serves ex Chennai, Tuticorin,Cochin,

Kolkata,Haldia, Vishakhapatnam and Mangalore via Colombo. Various vessels –MSC Qatar(1184 capacity),MSC

Sariska(capacity 943) etc. ROTATION Durban - Dar-E-Salaam - Mombasa - Nhava

Sheva - Mundra - Port Qasim - Jebel Ali - Mombasa - Dar-E-Salaam - Durban

Mediterranean Shipping Company(MSC)

Services are mainly based on fully containerised vessels.

Also has a division offering services for non-unitisable (break bulk and project) cargo.

Offers specialized services for commodities and reefers like cotton, rubber etc.(CommCare)

Provides reliable services for shipping refrigerated cargo(FreshCare)

SafMarine

Global reach, reliable schedules, fast transit times and more than 100 years of experience in commodity shipping

Dedicated experts who speak your language Owned agencies, modern container fleet A member of the world's largest shipping

group

Why SafMarine?

Where are we.

•Trade Route•Market Analysis•HR Requirements & Training•Advertisement•Shipping Lines

•Freight rates•Profit Projections•References

Data collection •Export import data from Ministry of Commerce•Data collected for years 2004-2010

Projections •Based on past data ,projections done till 2020•Key commodities only taken into account

Profitability matrix •After accounting for PER TEU cost for LCL and FCL cargo & other miscellaneous charges, income generated from customers, profitability matrix is created

Methodology–Profitability Matrix

• Shipping lines contacted -Parekh Marine -Maersk Lines -Safmarine -MSC

Data collection

Requests made on web

E-mail correspondence

Parameters Figures

Capacity of one TEU(in tonnes) 21.6

Cost Of TEU 1150 USD

USD-INR Exchange Rate Rs. 45/USD

Market Share of DHL 1%

Increase in Cost Per Year 5%

Increase in Frieght Per Year 5%

Port Handling Charges (Per TEU) Rs. 10000

Customs Clearance Charges (Per TEU) Rs. 4000

Documentation Charges (Per TEU) Rs. 2000

Less Than 1 TEU is considered as LCL

Freight rates-Assumptions

Nhava Sheva to Mombassa trade route - $ 1150 per 20 feet container Per 20 feet container: Port handling charges: Rs 10,000 Customs clearance charges: Rs 4000 Documentation charges: Rs 2000

Freight rates

Profitability Matrix

Microsoft Office Excel Worksheet

Where are we.

•Trade Route•Market Analysis•HR Requirements & Training•Advertisement•Shipping Lines•Freight rates

•Profit Projections•References

EXPORTS-ENGINEERING GOODS

YEAR DHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 80 4 226190 248702 22512 10%

2005-06 104 5 292874 338532 45657 16%

2006-07 174 8 485629 593180 107551 22%

2007-08 205 9 566449 734097 167648 30%

2008-09 163 8 522286 614890 92604 18%

2009-10 258 12 813000 1021751 208751 26%

Projections from the above data

2010-11 274 13 924788 1137567 212779 23%

2011-12 305 14 1045721 1331369 285647 27%

2012-13 337 16 1254866 1541707 286842 23%

2013-14 368 17 1399959 1769751 369792 26%

2014-15 399 18 1556425 2016745 460319 30%

2015-16 431 20 1815830 2284014 468184 26%

2016-17 462 21 2001952 2572968 571016 29%

2017-18 494 23 2302245 2885107 582862 25%

2018-19 525 24 2522460 3222028 699568 28%

2019-20 556 26 2869298 3585428 716130 25%

EXPORTS-ENGINEERING GOODS

EXPORTS-PLASTIC GOODS

YEARDHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 6.7651 1 29500 20295.3 -9204.7 -31%

2005-06 12.6088 1 38500 39717.72 1217.72 3%

2006-07 14.4905 1 43000 47927.32875 4927.329 11%

2007-08 27.8655 2 62938.77551 96773.39831 33834.62 54%

2008-09 21.704 1.0048 65600.05291 79144.04295 13543.99 21%

2009-10 54.5101 3 203250 208710.7068 5460.707 3%

Projections from the above data

2010-11 50.92923 2 142275 204750.1039 62475.1 44%

2011-12 58.91167 2 149388.75 248683.9173 99295.17 66%

2012-13 66.89412 3 235287.2813 296499.2368 61211.96 26%

2013-14 74.87656 3 247051.6453 348474.3785 101422.7 41%

2014-15 82.85901 4 345872.3034 404905.7862 59033.48 17%

2015-16 90.84146 4 363165.9186 466109.1487 102943.2 28%

2016-17 98.8239 5 476655.2682 532420.5831 55765.31 12%

2017-18 106.8063 5 500488.0316 604197.888 103709.9 21%

2018-19 114.7888 5 525512.4332 681821.8719 156309.4 30%

2019-20 122.7712 6 662145.6658 765697.7595 103552.1 16%

EXPORTS-PLASTIC GOODS

EXPORTS-IRON AND STEEL

YEARDHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 99 5 282,737 295764 13027 5%

2005-06 117 5 292,874 369413 76539 26%

2006-07 191 9 546,332 630806 84474 15%

2007-08 217 10 629,388 753337 123949 20%

2008-09 182 8 522,286 662246 139960 27%

2009-10 278 13 880,750 1064692 183942 21%

Projections from the above data

2010-11 292 14 995,925 1174701 178776 18%

2011-12 324 15 1,120,416 1368111 247695 22%

2012-13 356 16 1,254,866 1577925 323059 26%

2013-14 388 18 1,482,310 1805300 322990 22%

2014-15 420 19 1,642,893 2051468 408574 25%

2015-16 452 21 1,906,621 2317739 411118 22%

2016-17 484 22 2,097,283 2605509 508226 24%

2017-18 516 24 2,402,343 2916262 513919 21%

2018-19 547 25 2,627,562 3251576 624013 24%

2019-20 579 27 2,979,655 3613130 633475 21%

EXPORTS-IRON AND STEEL

IMPORTS-IRON AND STEELYEAR

DHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 114 5 282737.4 346412.9 63675.54 23%

2005-06 119 6 351449.1 380149.5 28700.36 8%

2006-07 137 6 364221.6 459008.4 94786.79 26%

2007-08 81 4 251755.1 285246.1 33490.95 13%

2008-09 129 6 391714.3 474290.3 82575.97 21%

2009-10 88 4 271000 340135.6 69135.63 26%

Projections from the above data

2010-11 96 4 284550 387935.4 103385.4 36%

2011-12 91 4 298777.5 387833.4 89055.9 30%

2012-13 86 4 313716.4 386751.4 73035.02 23%

2013-14 82 4 329402.2 384591.6 55189.4 17%

2014-15 77 4 345872.3 381248.9 35376.64 10%

2015-16 73 3 272374.4 376610.5 104236.1 38%

2016-17 68 3 285993.2 370555.2 84562.02 30%

2017-18 64 3 300292.8 362952.8 62659.94 21%

2018-19 59 3 315307.5 353663.7 38356.25 12%

2019-20 54 3 331072.8 342538.4 11465.54 3%

IMPORTS-IRON AND STEEL

IMPORTS-WOOL, FINE OR COARSE ANIMAL HAIR, HORSEHAIR, YARN AND WOVEN FABRIC.

YEARDHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 10 0.46 38037 39086 1049 3%

2005-06 12 0.56 39139 49805 10667 27%

2006-07 11 0.53 40295 49221 8925 22%

2007-08 9 0.43 41510 42359 849 2%

2008-09 9 0.41 42786 42183 -603 -1%

2009-10 13 0.59 44125 63245 19120 43%

Projections from the above data

2010-11 11 0.50 46331 57105 10773 23%

2011-12 11 0.51 48648 60205 11557 24%

2012-13 11 0.51 51080 63473 12393 24%

2013-14 11 0.51 53634 66917 13283 25%

2014-15 11 0.51 56316 70547 14231 25%

2015-16 11 0.51 59132 74372 15240 26%

2016-17 11 0.52 62088 78404 16315 26%

2017-18 11 0.52 65193 82652 17460 27%

2018-19 11 0.52 68452 87130 18678 27%

2019-20 11 0.52 71875 91849 19974 28%

IMPORTS-WOOL, FINE OR COARSE ANIMAL HAIR, HORSEHAIR, YARN AND WOVEN FABRIC.

IMPORTS-EDIBLE VEGETABLES AND CERTAIN ROOTS AND TUBERS

YEARDHL Business(In Tonnes) No. of TEUs Req. Total Cost Total Revenue Profit %age Profit

2004-05 8 0.37 23875 24,020 145 1%

2005-06 7 0.32 21625 22,124 499 2%

2006-07 23 1.00 60685 76,957 16,272 27%

2007-08 218 10.00 629350 758,077 128,727 20%

2008-09 16 0.74 42775 58,100 15,325 36%

2009-10 48 2.00 135500 186,288 50,788 37%

Projections from the above data

2010-11 96 5.00 355688 386,054 30,367 9%

2011-12 108 5.00 373472 456,614 83,142 22%

2012-13 120 6.00 470575 533,264 62,689 13%

2013-14 132 6.00 494103 616,438 122,334 25%

2014-15 144 7.00 605277 706,595 101,319 17%

2015-16 156 7.00 635540 804,228 168,688 27%

2016-17 168 8.00 762648 909,857 147,209 19%

2017-18 180 9.00 900878 1,024,039 123,160 14%

2018-19 193 9.00 945922 1,147,364 201,442 21%

2019-20 205 10.00 1103576 1,280,462 176,886 16%

IMPORTS-EDIBLE VEGETABLES AND CERTAIN ROOTS AND TUBERS

Profitability Matrix

Microsoft Office Excel Worksheet

Where are we.

•Trade Route•Market Analysis•HR Requirements & Training•Advertisement•Shipping Lines•Financial Analysis•Forecasting

•References

www.searates.com http://www.oneentry.com http://www.handyshippingguide.com/oversea

s-agencies/freight-agencies-worldwide/india/mumbaibombay

http://commerce.nic.in/ http://www.cargoshipping.net/international_c

argo_shipping-Kenya.htm

References

THANK YOU !