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Assessment 1 of 2
To be administered by the Trainer/Assessor after the completion of all formal information presentation
Course and Code:
BSB41115 Certificate IV in International Trade
Unit/s of Competency:
BSBINT409 Plan for International Trade
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Assessment Type:
Assignment, Report, Presentation
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Assessment 1 – BSBINT409: Plan for International Trade
Please complete this assessment and submit for marking. This forms part of your assessment. This forms part of your assessment for BSBINT409: Plan for International Trade.
The following documents are related to this document.
BSBINT409 Unit of Competency
BSBINT409 Learner Guide
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Performance objective
The students need to understand how to evaluate the most appropriate transport method, route and protection/security options according to cargo and delivery requirements, review shipping and airfreight services available for transporting cargo, evaluate packing, marking and stowage requirements for a variety of cargo, calculate international freight and other shipment costs.
Assessment description
This assessment provides questions on how to plan for International Trade.
To complete this assessment successfully answer the questions, prepare a report and a presentation in as much detail as possible.
Question 1
Objective
Ascertain business context of cargo movement
According to the Council of Supply Chain Management Professionals (CSCMP), what are the four categories of business logistics?
List five possible questions to ask to ascertain your objectives and specifications.
According to the Council of Supply Chain Management Professionals (CSCMP), these are the four categories of business logistics:
Balanced System
Heavily Outbound
Heavily Inbound
Reverse System
In order to ascertain your objectives and specifications with regard to the cargo on board, the five questions that you can ask are:
What is the content, quantity, size, value and weight of your cargo?
What is the place of origin and/or destination of your cargo?
Who will be receiving the cargo, and does it have special requirement?
What is your budget?
What is your arrival deadline?
Question 2
Objective
Examine factors to be considered in route/mode selection
Identify four factors to consider when choosing route and mode of transport and explain each briefly.
Name two advantages and two disadvantages of each mode of transport.
The four factors to consider when choosing route and mode of transport are:
Accessibility of cargo for transport.
Capacity of cargo and the requirements of its capacity.
The type of cargo and its needs for transportation.
The cost effectiveness of sending cargo is in line with the budget.
How frequently will the cargo be sent and received?
Advantages and disadvantages of each mode of transport:
Advantages
Roads have relatively low cost and gives more control over schedule and tracking.
Through sea, once can ship large volumes at lower costs and the contains can be used on the ship and for further transport, e.g. road/rail.
Through rail, Maintain railroads across country and into other countries extensively as well.
Air offers quick and long distances of delivery where a range of goods can be transported.
Disadvantages
Long distance can sometimes increase time, cause traffic delays and even breakdowns.
Sea is slower than most modes of transport and has inflexible routes and associated timetables.
Rail as well is slower and more expensive than other routes of transport and can be disrupted through mechanical failures and strikes.
Air offers higher costs and fuel prices. Also, it is not suitable for all goods.
Question 3
Objective
Evaluate conditions and risks of different routes in relation to delivery requirements and utilise resources that provide information on the current service status of particular transport routes
Explain possible conditions and risks of each mode of transport.
(within 150-180 words)
Name two resources that can be utilised to check current service statuses.
Between road, air, rail and sea, there are a number of risks associated with almost all modes of transport. For instance, with good transported through air, the cargo may face temperature and pressure changes, along with delays and strikes. With regard to road and rail transportation, the risks are often associated with movement hazards i.e. vibration shocks, impact causing breakage, careless handling and even road and lines being blocks. Finally, sea transportation can cause water damage and even cause containers to drop into the sea due to wave impact. Finally, the corrosive atmosphere and the hostile storage conditions also contribute towards the hazards of sea transportation. For all these reasons and more, the aspects with regard to planning international trade should be treated with cautions. Thus, in order to ensure that one has the right information, recent travel information, the associated conditions and risks involved should be evaluated before sending the required cargo.
Some resources that can be used to check current service statuses:
Australian and international news stations/websites.
The shipping provider’s website, e.g. updates or news pages.
Question 4
Objective
Identify airlines and air cargo services operating in and out of Australia
Identify your nearest airport and list three airlines that fly from there.
Where is your closest air cargo airport? (within 20-30 words)
What are the three primary options of air freight service? Briefly explain each. (within 30-40 words for each)
My nearest airport would be Sydney Airport and following flights arrive and depart this terminal:
Eastern Australia Airlines
Pel-Air
Qantas
The new Sydney airport began offering freight firms the use of the airport for its services recently. Thus, that would be the closest to me.
There are three forms of air freight services. They are;
Next flight out – This service ships cargo as soon as a flight is available. It is an expediated flight service and is one of the fastest options there is. However, it is often one of the costlier services and needs a service provider that has the resources available and can locate free space even at the last minute to meet deadlines.
Consolidated Shipping – Here, the cargo is combined with other shipments and it moves on a set schedule. This combining of cargo and the set schedule usually leads to lower costs than other options. However, smaller shipment sizes can certainly lead to delays.
Deferred – This form of shipment is only available if there is room of flight, thus this option is used for low priority shipment. It is to maintain a regular schedule and is only allowed to defer a few working days at a time. It offers great cost value though.
Question 5
Objective
Compare configuration and carry capacity of different types of aircraft
Give two major differences between the configuration of a commercial air freighter and a passenger aircraft.
Identify the aircraft with:
The largest cargo volume
The fastest cruise speed
The largest cargo mass
The furthest maximum range
Commercial Air Freighter
Passenger Aircraft
Larger spaces, fitted security measures.
Internal arrangement created to meet passenger needs before cargo.
Entry and exit points designed for cargo.
Doors aisles, facilities, galleys, pitch, and seat sizes have an impact on design.
The aircraft with:
The largest cargo volume – Airbus Beluga
The fastest cruise speed – Boeing 757-200 Freighter
The largest cargo mass - Antonov An-225
The furthest maximum range - Antonov An-225
Question 6
Objective
Identify shipping services and types of ocean vessels operating in and out of Australia and compare different types of shipping services
Identify three Australian ocean freight companies.
Name five different ocean freight transportation services and briefly explain each.
Three Australian ocean freight companies are:
Oceanic Shipping
Cargo Australia
Seabridge
The five different ocean freight transportation services are:
Less than Container Load (LCL) – This is a cost-effective option where smaller loads of cargo are sent overseas by sharing container space.
Full Container Load (FCL) – This form of fright transport is used if larger amounts of valuable goods need to be shipped in a timely manner.
Temperature-Controlled Freight Forwarding (Reefer Containers) – These are refrigerated containers, which are usually set to a particular temperature that protects goods from being spoiled. Here, both the temperature and humidity is controlled at all times.
Hazardous Containers and Dangerous Goods – Such containers are used for the transportation of flammable liquids, explosives, pharmaceuticals, gases, dry ice, fuel cell engines, corrosive substances, and oxidising substances.
Roll-on, Roll-off (RoRo) – Used to transport wheeled items, that can be rolled on and rolled off of tractors, automobiles, and other heavy machinery that is mounted on wheels.
Question 7
Objective
Compare configurations and carry capacities of different types of ocean vessels
Name an ocean vessel which you would select for the following cargo:
Cars
Garments and footwear
Coal
Crude oil
Liquefied natural gas
Where possible, identify any maximum capacities.
An ocean vessel ideal for the following cargo:
Cars – Ro-ro vessels - can carry over 21,000 TEU i.e. twenty-foot equivalent units.
Garments and footwear – Container vessels
Coal – Bulk vessels
Crude oil – Crude carriers
Liquefied natural gas – Liquefied gas carriers
Maximum capacities for ocean vessel ideal for the following cargo is:
Cars – Ro-ro vessels -
Garments and footwear – Container vessels
Coal – Bulk vessels - 400,000 metric DWT.
Crude oil – Crude carriers - few thousand DWT to 550,000 DWT.
Liquefied natural gas – Liquefied gas carriers - 10,800m³ (380,000 cu ft).
Question 8
Objective
Analyse and prepare protection, presentation and preservation requirements
List five important pieces of information that you should know in order to prepare your cargo for transport.
Write a short guide on packaging considerations that cover the ‘three Ps’ (protection, presentation and preservation). (within 200-400 words)
Five important pieces of information that one should remember in order to prepare your cargo for transport:
Nature and type of goods
Mode of transport
Volume and Weight
Types of packages
Number of packages
Once you have analysed the above points, you can properly prepare your goods for their journey. The points below are a variety of packaging considerations to cover the ‘three Ps’. Goods should be properly secured, evenly distributed and well stowed within the packaging. If the packaging is not completely filled, then goods must be cushioned to stand against any shock or vibration. Where necessary, use battens (bars of wood) or dunnage (mats, shavings, etc.) and adequate internal bracing. Strap together and secure multiple smaller packages, this can be done with a wooden pallet base. When assembling your cargo packaging, make sure it is the largest practical unit it can be according to handing, dimension and weight requirements. Consider other packages that might travel or be stored with yours, prevent damage from ‘over-stowing’. Check regulations for banding and strapping, for Australia and the transit/destination countries (if applicable). Try to avoid re-using packaging that could lead to breaks or collapsing. Fit the packaging as closely as you can to the shape and size of the cargo. Where possible, include waterproof wrapping and/or lining. Do not over-package your goods as this reduces carrying capacity of the transportation. Closely follow any regulations on packaging dangerous goods, e.g. chemicals, liquids, etc. Always consult the transport service provider with any queries, they will have the best knowledge on types of packaging the routes they will be travelling. Presentation is also important in the export of products; this means design, colour and embellishment which can produce a favourable reaction and improve its competitiveness.
Question 9
Objective
Analyse range of containers available for international cargo and evaluate for use
List five different international cargo containers and identify the type of cargo they transport.
Five different international cargo containers and the type of cargo they transport:
Corrugated Box – lightweight, recyclable and used for a variety of products.
Wooden Box – For heavier and denser good. Used for military and government shipments.
Crate – Usually made of wood. Used to transport big, heavy and does not need any sheathing for transport.
Intermodal container – Most widely used. ISP standardized and designed for international transport. Comes in a few different sizes.
Intermediate bulk shipping container – used for shipment of bulk material or fluids. Can be made of plastic, steel, composite, stainless steel, etc. and some can be folded (collapsed).
Question 10
Objective
Evaluate marking requirements and prepare correct marking advice
Name six different types of goods that require marking.
What are the three key pieces of legislation that cover marking requirements?
Briefly describe the correct form of a trade description. (within 120-150 words)
Six different types of goods that require marking;
Food
Articles made from china, porcelain, earthenware or enamelled hollowware. Commonly used in connection with serving food. Kitchenware or kitchen utensils
Electrical appliances
Textile products
Articles of apparel including shoes
Cigars, cigarettes, manufactured tobacco, cigarette papers, cigarette tubes
The three key pieces of legislation that cover marking requirements are:
Customs Act 1901
Commerce Trade Descriptions Act 1905
Commerce (Trade Descriptions) Regulation 2016.
The trade description must be in the English language and in prominent and legible characters. It should include the name of the country where the goods were made or produced. Where required, should include a true description of the goods ('true description' is not defined in the legislation so is taken to be anything that is a correct and accurate explanation of the goods). Unless a prepacked article, be in the form of a principal label or brand (including a mark, device, name, word, letter, numeral or symbol and a combination of 2 or more of those things) attached in a prominent position, and as permanently as practicable, to the goods – if attachment to the goods is impracticable, to the principal coverings containing the goods for wholesale or retail.
Question 11
Objective
Identify risk factors in relation to packing and storing of goods for transportation and select appropriate options
Identify three possible packing and storing hazards.
Name one control that you can put in place to avoid each. (within 80-100 words)
The three possible packing and storing hazards:
Manual tasks, e.g. lifting, repetitive movement, overexertion.
Machinery and equipment, e.g. moving parts.
Gravity, e.g. falling objects, falls, slips and trips.
In order to ensure the safe transit of the products that one is shipping, important to reiterate the need for good, solid packaging that will not break during transit or storage. This is a risk for both worker and goods. You could be dealing with very large sizes and weights, items can fall and break so make sure packaging is appropriate and secured appropriately. To prevent further damage, it is essential that lack of ventilation, incorrect temperature, duration, etc. should also be given due attention.
Question 12
Objective
Examine and apply types of rates, volume-to-weight ratio factors, volume rules including rounding off and allowable projections, principles and methods of rating cargo for international carriage by sea
Identify three different rates for sea transportation.
Using the ocean freight ratio and formula, calculate the volumetric weight for the following shipment:
100 cartons of Vegemite
Each carton measures 30cm x 45cm x 30cm and weighs 10kg
Imagine the actual weight of the Vegemite shipment was 1000kg (100 x 10 kg) in total, which would be the chargeable weight?
Three different rates for sea transportation are:
Commodity or tariff rate - Relevant to a particular commodity and rates may be quoted per tonne or by volume.
Freight of all kinds (FAK) - Per TEU/FCL/LCL in volume or weight.
Ad Valorem (‘According to Value’) - High-value goods which are costed by commodity freight rate plus premium for value of goods.
Based on the calculations, the volumetric weight for shipment of goods is 4050 Kg.
The chargeable weight will be calculated and rounded to the nearest whole number and if you have varying weights between boxes, always take the highest weight and multiply that by the number of boxes.
Question 13
Objective
Take into account variations in calculating shipping charges caused by surcharges and other variants and calculate and compare costs of shipping a variety of goods by several types of ocean service
Identify eight possible sea transport charges and variants.
You will need the internet for this activity.
Locate and choose two ocean shipping service providers with online quotation calculators. Fill in an online form which will provide you with an overall estimated cost for three different relevant products of your choice. Write a short report (within 150-250 words) of your findings.
Use www.worldfreightrates.com if unable to locate a specific company.
The eight possible sea transport charges and variants are:
Australian post security surcharge
Delivery fuel surcharge
Currency adjustment factors
Peak season surcharge
Customs clearance and agency fees
Dangerous goods regulation fees
Destination port charges, e.g. lift on and lift off
Empty return fees
According to the required conditions, I used https://www.worldfreightrates.com/ first. I chose a containerized shipping method from Sydney, Australia to Port Chalmers, New Zealand. I chose to send apparels worth $1000 dollars and the freight company asked for $360.62 - $398.58, which was also subject to additional fee and taxes.
Question 14
Objective
Examine and apply types of rates, volume-to-weight ratio factors, volume rules including rounding off, principles and methods of rating cargo for international carriage by air
Identify and explain the volume-to-weight ratio and formula for air freight.
Using the Vegemite shipment information from Question 12C, calculate the volumetric weight for air freight:
100 cartons of Vegemite
Each carton measures 30cm x 45cm x 30cm and weighs 10kg
Total actual weight is 1000kg
Which is the chargeable weight? (within 40-60 words)
The carrier will then consider both the weight and volume of your cargo by converting the volume into a ‘weight equivalent’ (also known as volumetric/dimensional weight). Then a chargeable amount can be calculated per kilogram for whichever is the greater figure between the actual/gross weight and the volumetric weight.
By multiplying 30cm x 45cm x 30cm, we get the volumetric weight for the air freight i.e. 4.050 metric tons.
Considering that the CBM for the shipment is higher than the actual weight i.e. 4.050 Metric tons to 1000kg, so the volumetric weight would be the chargeable weight.
Question 15
Objective
Explain variations in calculating airfreight charges caused by the applicability of TACT rates, fuel surcharges, other variants, and exchange rates and calculate and compare costs of shipping a variety of goods by different air cargo services
Name two airfreight fees or surcharges.
What is DHL’s fuel surcharge for August 2019?
Briefly describe what is contained in TACT. (within 200-250 words)
You will need the internet for this activity.
Locate and choose two air shipping service providers with online quotation calculators. Fill in an online form which will provide you with an overall estimated cost for three different relevant products of your choice. Write a short report (within 150-250 words) of your findings.
Use www.worldfreightrates.com if unable to locate a specific company.
Here are the quotation results for Sending a free sample 12kg box of Tim Tams from Brisbane to Tokyo:
Australia Post
express post international = $172
express courier international merchandise = $205
airmail = $165
FedEx: Australia Promotional Export rates (Zone B Japan) = $18.
DHL’s fuel surcharge for August 2019 is 17.25%
The Air Cargo Tariff and Rules (TACT) contain comprehensive information about air cargo rules and must be consulted before undertaking airfreight transportation. It covers the regulations, rates and charges associated with sending goods by air, including IATA Industry rules on the acceptance of goods, Air Waybill completion, calculation of charges and cargo claims. County rules, regulations and charges on import, transit and export for over 200 countries. Information on airport facilities, such as handling equipment and storage facilities. IATA airline, city and airport codes and AWB prefixes. Industry and carrier-specific rates: over 4,5 million rates for 350,000 city pairs covering 215 countries worldwide. Industry, country and carrier specific charges for charges collect, class rates and DGR. Exchange rates are constantly changing and you will need to identify the rates at time of transportation. There will be an import rate and export rate for the currency you are converting to/from.
According to the required conditions, I used FedEx Australia first. I chose a containerized shipping method from Sydney, Australia to Queenstown, New Zealand. In order to send a 25 kg box with goods worth $100 Australian dollars, FedEx would change $269.12. On the other hand, DHL would charge $336.81 Australian dollars to send the same shipment.
Question 16
Objective
Investigate and communicate postal and courier freight rates and size/weight factors and limitations and investigate and communicate rates and costs associated with chartering vessels and aircraft
Name six methods of effective communication when relaying information about rates and costs.
Here are some considerations for communicating your postal and courier freight rates and/or rates and costs associated with chartering vessels and aircraft:
Brevity is key - keep it simple and to the point
Include only facts and figures that are relevant and appropriate
Use clear and concise language
Stagger the feed of information if necessary or possible
Encourage feedback or any queries
Reinforce company and transport requirements in line with rates and costs mentioned
Question 17
Objective
Investigate and communicate rating principles and methods used in domestic, sea, road, rail and air transport
Create a short PowerPoint presentation (maximum 10 slides) on the rating principles and methods used in domestic, sea, road, rail and air transport and explain how you would communicate this information.
Attached with.
Question 18
Objective
Investigate all standard and extraordinary ancillary shipment costs on a door-to-door basis applicable in each mode
Name four ancillary costs that must be considered in door-to-door shipping.
Four ancillary costs that must be considered in door-to-door shipping are:
Ground transport expenses (from the warehouse to the port of origin and from the port of destination to the warehouse)
Local and cargo handling costs in the origin and destination air/ports, e.g. lift on and lift off
Specific transport freight and surcharges, e.g. CAF/BAF and TEU rates
Management and documentation delivery costs
Question 19
Objective
Investigate and communicate the total cost concept and other factors that may determine whether cargo is carried by air or sea, or a combination of both (multimodal transport)
What are the five major considerations of selecting between air and sea transportation?
Briefly explain a ‘total cost concept’ and list the six main costs included.
The five major considerations of selecting between air and sea transportation are:
Cost
Speed
Carbon footprint
Surcharges and taxes
Reliability
Total cost concept is a key concept in the understanding the whole process of international logistics; it doesn’t look at individual activities but the total cost of shipments and how to reduce this. This means looking at the system as integrated rather than individual parts, if you reduce one cost this will usually mean an increase in others. Main costs include:
Customer service level costs
Transportation costs
Warehousing costs
Order processing and information costs
Lot quantity costs
Inventory carrying costs.
Question 20
Objective
Evaluate the need for cargo insurance and investigate the standard types of cover arrangements used by underwriters
Name four different types of cargo insurance.
List seven items that you could be protected from.
Name three possible questions to ask yourself when evaluating the need for cargo insurance.
The four different types of cargo insurance are:
Land cargo insurance
Marine cargo insurance
Air cargo insurance
Single transit insurance
The seven items that you could be protected from:
Fire
Theft
Earthquake
Collison
Heavy weather
Sinking
Derailment
Non-delivery
The three possible questions to ask yourself when evaluating the need for cargo insurance are:
What would happen to your company if an entire shipment were lost?
Is the cargo of high value and/or desirable nature?
Are the goods lightweight but of a high value?
Question 21
Objective
Identify documents to be lodged with carriers, forwarders, insurance underwriters and customs in cargo loss or damage situations and complete for a hypothetical situation
Using the information below, fill in this claim form adding any details necessary. You should complete it in full ready for submission.
100 cartons of Vegemite
Each carton measures 30cm x 45cm x 30cm and weighs 10kg
4 cartons have gone missing
Own truck transportation from Sydney to Brisbane.
To access a claims form, use the following link and print your completed document:
https://www.zurich.com.au/content/dam/au-documents/claims/marine/goods-in-transit-claim-form.pdf
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