This column is an abridged version of TED Talk format presentation made by this writer during the 2nd Philippine Logistics Services Conference held 15 July. The original presentation is entitled “Cargo Visibility Events: Bridging The Gap Between “Moves” And “Steps”.
Just imagine looking at a photo of any Philippine port full of stacked containers, trucks queuing at the entry/exit gates and shore cranes servicing vessels at berth. Such image will mostly likely evoke traumatic memories of port congestion.
In contrast, I look at such photo as the perfect opportunity to share with our readers a tangible and practical guide on how to answer the most basic question that every shipper, importer and logistics service provider needs to answer at any given time on the whereabouts of their cargo.
During the 1990s, technology solutions for cargo pre-alerts and Track & Trace were already widely used. Nowadays “Visibility” is on the tip of every supply chain manager’s tongue. Multinational companies and large logistics providers utilize sophisticated solutions such supply chain “control towers” and even blockchain technology—but how about small, medium and micro enterprises (SMMEs)?
Where Is My Cargo?
Let us visualize the challenges that SMMEs encounter when seeking satisfactory answer to this most basic question by taking a close look at the attached illustration.
From the time the vessel carrying import shipment arrives at a Philippine port up to the final moment before it is physically delivered to the importer, tracing the latest status and whereabout involves search or inquiry based on the bill of lading number or container number.
- Bill Of Lading Number is found and repeated in 15 hard copy/ electronic documents
- Container Number is found and repeated in all of the above 15 documents plus 3 terminal Electronic Data Interchange (EDI) messages
These hard copy and electronic documents are the following:
- Shipping line or freight fowarder electronic cargo manifest
- Shipping line or freight forwarder hard copy manifest printout
- Notice of cargo arrival
- Ocean / house bill of lading
- Freight bill of lading
- Importer or customs broker letter guarantee
- Shipping line or freight forwarder delivery order
- Terminal container release order/delivery order
- Import entry declaration (customs)
- Import permit/transfer admission permit (PEZA and freeport)
- Electronic On-Line Release System message
- Arrastre/wharfage/storage invoice
- Terminal pre-advise
At any given time, the typical SMME must rely on his authorized forwarder or customs broker to provide the answer.
Cargo Visibility Event = Cargo Physical “Move” + Documentation Process “Step”
Instead of the traditional Track & Trace, a practical and much useful alternative is to visualize and measure in terms of “cargo visibility event”.
Event # 1 – Shipping Line/Freight Forwarder Shipment Clearance
- Vessel has arrived and cargo already discharged
PLUS - Cargo arrival notice received
- Shipping line/forwarder charges paid
- Bill of lading endorsed
- Delivery order issued
Event # 2 – Customs Import Clearance
- Import shipment stored inside container yard of terminal
PLUS - Electronic import entry declaration lodged by customs broker
- Import declaration filed with customs at the port of entry
- Import duties, taxes and other charges paid through auto-debit
- Electronic OLRS transmitted by customs system
Event # 3 – import shipment release by arrastre/operator
- Truck enters the terminal to pick up import cargo
PLUS - Container release order/delivery order
- Terminal pre-advise
- Arrastre/wharfage payment
- Terminal appointment booking
- Terminal equipment interchange receipt (EIR)
Leo V. Morada is a subject matter expert on IT applications in Philippine port operations with more than 30 years’ senior IT management experience and business strategy formulation on technology solutions in port operations, electronic transactions with customs & port authority, and air/sea port community system applications. He is Director of Cargo Data Exchange Center, Inc, a Value Added Service Provider accredited by BOC and PEZA. He can be contacted at lmorada3f1@yahoo.com.