Sunday, June 29, 2008

Rosewood Case Study: Discussing Transport Options

Rosewood Case Study: Discussing Transport Options

a) Transport by truck CIP Laredo, Texas

CIP denotes a land based shipment of goods from Canada to Laredo, Texas as well as freight charges and costs for customs clearance from Canada to the USA with only minimum insurance required so this in fact represents one facet of lower costs and risks for Rosewood. If the carriage is limited to one shipping company the risk remains entirely with Rosewood as to liability for damages. However if there are any transfers of carrier the risk is also transferred. CIP Laredo implies there will be a transfer to Monterrey specified by the buyer.

b) Transport by vessel CIF Tampico, transshipped in Miami

CIF denotes minimum insurance coverage paid for by the seller as well as freight charges and costs for customs clearance with the added responsibility of marine insurance charges with transhipments in Miami. The difference in actual costs quotations between CIP Laredo, Texas and CIF Tampico with tran-shipment in Miami will impact choices over lower costs and risks and despite distance factors ocean freight might prove cheaper than road transport freight due to current fuel costs.

For example if Rosewood is located in Montreal then the actual distances between destinations may provide an idea of which transport costs will be higher and thus which insurance costs will be higher.

Montreal to Laredo: 3029 km
Montreal to Miami: 2276 km
Montreal to Tampico: 3399 km

Laredo to Tampico: 616 km
Miami to Tampico: 1828 km

These distance calculations made on absolute distances irrespective of geography raise interesting questions. Cost comparisons might necessarily be made questioning whether CIP Laredo makes sense when Miami appears over 700 km closer. In addition the absolute distance to Tampico from Laredo is only a little over 600 km. Various quotations and possible routings will determine minimum costs and liabilities. At this point CIP Laredo may require comparisons among competitor freight forwarder companies. Montreal to Miami to Tampico appears a great deal longer in terms of absolute distance. However freight volumes may be higher through ocean bound delivery routes and thus costs may in fact be cheaper. Only real time quotations between both freight options will provide the information to determine the best costs and risks minimization.

City Distance Calculator service provided for FREE by Geobytes, Inc.

Crated and containerized: This would appear the best method of ensuring product quality considering the premium product prices being charged for these furnishings. However it is also the most costly in terms of packing and takes the most freight volume and weight. In the case of a direct to customer delivery this would appear the best method of shipment. Least possible damages to cargo. More expensive than palletized freight.

Palletized and containerized: This would exemplify the most economical freight movement volume and weight considerations requiring minimal additional packing. However upon arrival assembly and instructions will be required as well as perhaps additional costs such as field corporate technicians at assembly point to ensure quality of product delivered. It would appear unlikely that a desk set costing more than the price of an economy car would arrive to the customer in unassembled form. However certain portions such as perhaps table leaves or sectional pull-outs and/or optional additions, pop-outs and do-dads might be best palletized as options and features which a contracted distributor might be required to have on hand depending on Rosewood's marketing or customization strategy.

However the Monterrey shipment represents a delivery similar to pro-forma sample which indicates direct to customer delivery. In the case of delivery to franchisee or distributor palletized and disassembled sets would probably work well. Damages more likely to occur. Less costly than crated products.

Wednesday, June 25, 2008

Franklin & Marshall College invites applications

The Department of Business, Organizations, and Society (BOS) at Franklin &
Marshall College invites applications for seven tenure-track faculty positions,
beginning fall semester 2009. Five are in traditional functional areas of business
education, and two are thematic positions open to faculty of any relevant
background. This hiring initiative is part of a multi-year process to extend and
refine the College’s signature undergraduate program. The department will
move into a renovated historic building in fall 2009.

Franklin & Marshall College is a small (approximately 2,000 undergraduates), highly selective, residential liberal arts college with a fully integrated business program. The BOS Department ( expects research, teaching, and service competencies and offers a collegial and supportive environment. BOS includes courses in accounting, business ethics, finance, human resource management, law, marketing, organizational behavior, and strategic management. The teaching load is 3/2 and includes participation in the College’s general education program. We will offer competitive salary and support at Assistant and Associate Professor ranks.

We seek to fill five positions with faculty who can teach in specific functional
areas and to fill two positions with faculty from any relevant background that
supports our core curriculum.

Functionally Specialized Positions
- Accounting
- Finance
- Organization Behavior (two positions)
- Marketing, Management, or Strategy

Thematically Specialized Positions- Sustainability: Organizations and the natural and social environment,
sustainable business practice, social and environmental sustainability relevant to
business and organizations
- International: Globalization, cross-cultural analysis, or related aspects of
international business

Applicants should possess, or be close to completing, a doctorate in
accounting, finance, international marketing, management, marketing,
organizational studies, strategy; a related discipline (e.g., economics,
psychology, or sociology); or other areas with a thematic emphasis related to
our mission. Faculty rank will be assistant or associate professor, depending on

Applicants must have a strong commitment to teaching undergraduates in a
liberal arts setting. Teaching capacity for traditional functional areas of
management education is required. Capability of teaching our introductory
course is expected, and capability of teaching in multiple areas — including
social science statistics and research methods, analysis of business and society,
corporate citizenship, business social responsibility, ethics, and the legal
environment of business — is desirable.

Responsibilities include teaching, advising, and mentoring undergraduates;
research oriented towards publication in high quality academic journals; and
participation in department and college governance.

We will begin reviewing applications on July 15 and continue until the positions
are filled. Only complete applications will be considered. Candidates should
send a letter of application, curriculum vitae, graduate transcript, three letters of
recommendation, teaching and research statements, and teaching evaluation
forms. We will not accept electronic submissions. Be sure to specify the
position(s) for which you are applying. All application materials should be sent

Prof. Jeffrey Nesteruk
Chair, Department of Business, Organizations, and Society
Franklin & Marshall College
P.O. Box 3003
Lancaster, PA 17604
OFFICE: 717-291-4069 FAX: 717-358-4568

Franklin & Marshall College has a demonstrated commitment to cultural
pluralism. EOE

Softimpact is now recruiting in Lebanon

Softimpact is now recruiting in Lebanon

Senior Software Developer Ref: (SSD)
Assist in the development of client/server and web applications
Test and document applications

Fresh graduate up to 2 years of experience
Excellent inter-personal communication skills
Disciplined and Dynamic
Works under pressure
Enjoys multi-tasks jobs

Holds a university degree in computer science / engineering. Knowledge in:,, VB6 is a must
Microsoft SQL Server
HTML, XML, Javascript.
PHP is a plus
Flash / Action scripts is a plus
Fluent in English & Arabic: written and spoken.
Send CVs to: with Ref:(SSD)

IT Sales Consultant. Ref: (ISC)

IT Engineer or business computer
Fluent in Arabic, English , French is a plus;
Previous experience in selling IT / Web solutions is a plus;
Male or female;

Fixed salary (Depending on experience) ;
Commission on sales as per company commission structure;
Transportation allowance;

Send CVs to: with Ref:(ISC)

Graphic / Flash Designer Ref: (GFD)
At least 2 years experience
Bachelor's degree in Graphic Design or Multimedia
knowledge in Action Scripting within Flash
Self motivated, organized and excellent team player

Job Description
Creating top quality web sites, Flash presentations, and other Flash enabled products for our National and International clients.

Send CVs to: with Ref:(GFD)

Executive Secretary Ref: (SEC)
Compose, type, edit and proofread correspondences and documents
Follow up on pending issues
Receive calls and greet visitors, take and relay messages and respond to requests for information
Perform administrative duties such as filing, handling incoming and outgoing mail, schedules and appointments, etc.
Able candidates should hold the following credentials and qualifications:
Minimum 1 year of relevant experience
Good command of Arabic and English. French is a plus.
Good Knowledge of Microsoft Office (word, excel, powerpoint and Outlook)
Good computer typing skills in Arabic and in English

Send CVs to: with Ref:(SEC)

Job Opportunity - Executive Coordinator - Canadian Business Council Abu Dhabi

Job Opportunity - Executive Coordinator - Canadian Business Council

The Executive Committee of the Canadian Business Council -Abu Dhabi is accepting applications for the staff position of Executive Coordinator.

The Canadian Business Council is a membership organization for Canadians and those interested in doing business with Canadians. The Council provides opportunities for networking and the exchange of business information, as well as assisting Canadians and Canadian companies exploring or establishing companies in the UAE.

The incumbent will report to the Chairman of the Executive Committee and will have key responsibilities for extensive liaision with the Executive Committee which includes arranging and attending meetings; membership and outreach; office management ans taff supervision; public relations; event management; and project management.

Qualifications:- Canadian citizen
- University degree, preferably from a Canadian University.
- Min. 7 years working experience out of which 3 years in a similar organization, preferred
- Strong command of English language
- Candidates with resident permits will have the priority
- Hours of work - 35 hr per week with 25 days annual leave. Other terms and conditions will be as per the UAE's Ministry of Labour Laws and regulations.

A fuller position description and salary information will be provided to short listed candidates.

Interested candidates should submit their CV's by July 2, 2008 to the attention of:
Jack Matar
Canadian Business Council
Fax: 02 -677 2797

Sunday, June 22, 2008

Closing Canada’s Trade Culture Gap: EDC CEO Talks About Canada’s Future

Closing Canada’s Trade Culture Gap: EDC CEO Talks About Canada’s Future
(Export Development Canada)

Eric Siegel, President and CEO of Export Development Canada (EDC) today called for the federal and provincial governments, industry and the financial sector to invest in effective partnerships to elevate Canada’s trade competitiveness.

Mr. Siegel addressed the growing gap between Canada and the rest of the world in promoting its own trade culture during a speech at the Economic Club of Toronto.

“Over the years I have seen Canadians get a lot better at trade. I am here today to say that I am afraid we have to get an awful lot better. There are real danger signals out there, and they concern me deeply,” said Mr. Siegel. “We may be growing, but not nearly enough. Not in comparison to what the rest of the world is doing. It’s not just India and China, who get all the media attention, that are passing us by. We’re also being outpaced by our traditional competitors in the U.S. and the rest of the industrialized world.”

The speech, entitled “What the Future Holds for Canada's Trade”, examines the importance of trade to economic growth, Canada’s place in global trade and what Canada needs to do to regain its competitiveness. Involved in 12% of Canada’s trade annually, on average, EDC is active in all areas of Canada’s trade. Mr. Siegel said that governments, private industry, the financial sector and EDC need to look at four key areas where Canada needs to invest to improve its sliding trade competitiveness.

These are:
• improving Canadian education and skills related to trade;
• celebrating, supporting and learning from Canada’s key global performers;
• doing a much better job of branding and promoting Canada abroad; and
• getting more Canadian companies involved in trade.

Mr. Siegel has been active in Canada’s trade finance sector since 1979. Mr. Siegel’s remarks are available online at

World Bank Raises China Growth Forecast To 9.8%

World Bank Raises China Growth Forecast To 9.8%
(The Canadian Press – Associated Press)

China's economy is weathering the global slowdown better than expected, the World Bank said Thursday as it raised its growth forecast for the Asian giant to 9.8% from 9.4%.

The World Bank cited the country's strong domestic demand and sustained competitiveness in exports as key strengths.

“Amid weaker and uncertain global prospects, China's growth will be supported by strong international competitiveness and a robust domestic economy,” David Dollar, the bank's country director for China, told reporters in Beijing.

Just two months earlier, the World Bank had lowered its growth estimate for China to 9.4% from 9.6% on weakening demand for its exports.

The back-and-forth revisions reflect the uncertainties prevailing at a time when the U.S. economic outlook remains murky due to the fallout from the mortgage lending crisis. They also result from a revision in China's own gross domestic product growth estimate for 2007, which was raised by a 0.5 percentage points following the bank's most recent half-yearly report in early April.

Despite the upbeat overall message, the quarterly report did note that China's growth is moderating as investment in factories, construction and other fixed assets slows.

Although the nominal rate of growth in such investments remains above 25% on an annual basis, much of that increase reflects surging prices. Adjusted for inflation, real growth in such spending slowed to 16 % in January-May, with the greatest deceleration in industry – a sector most exposed to global trends, the report said.

“Global growth is on course to slow further and commodity price-driven inflation has become a complicating factor everywhere. These developments imply considerably more international uncertainty and risk,” Dollar said. “The upward revision to our growth forecast largely reflects revised GDP data showing stronger service sector growth,” he said.

The World Bank's current forecast is for growth to slow to 9.2% in 2009.

The Chinese government has set a growth target for this year of 8% following last year's sizzling 11.9% expansion.

The Washington-based bank said it did not expect the calamitous earthquake that struck central China last month, killing about 70,000 people, to have a significant impact on the wider, national economy. However, it noted that reconstruction might actually boost growth in the months ahead.

The bank lauded China's progress in combating inflation, which fell to 7.7% in May from 8.5% in April. It forecast that the inflation benchmark, the consumer price index, will rise 6% for all of 2008.

The report noted that the gradual strengthening of the Chinese currency, which has gained 20% against the U.S. dollar in the past three years, can help reduce inflationary pressures by boosting China's purchasing power at a time of surging prices for crude oil and other crucial commodities.

At the same time, inflows of speculative funds from overseas, which have been flooding into China in anticipation of the future strengthening of the Chinese yuan, might be discouraged if Beijing changes its policies “to effectively change exchange rate expectations,” it said. It did not elaborate on how that might be done.

The report also noted the difficulties Beijing will have in maintaining price caps on fuel, food and other necessities – controls are intended to insulate domestic consumers and businesses from surging international prices and to control inflation. “With China's economy more interlinked with the global economy than in the past, such price gaps will be more difficult to maintain over time,” it said.

China is facing increasing pressure over the ramifications of its fuel price controls, and the subsidies it pays to refiners to compensate them for the widening gap between soaring costs for crude oil imports and the prices they can charge consumers. Such subsidies are costing China about 330 billion yuan ($47.9 billion) a year, or about 1.2% of the country's GDP.

“Keeping prices low distorts demand behaviour,” the report said. It reiterated its call for Beijing to instead direct its subsidies to individual consumers rather than state-run oil companies. “It's in China's interest to let prices rise to the world level and be passed through for investments and households to be more energy efficient,” Dollar said.

Hong Kong, Singapore Most Global Trade Friendly: WEF Study

Hong Kong, Singapore Most Global Trade Friendly: WEF Study
(Agence France-Presse)

Hong Kong and Singapore are the two economies most conducive to global trade, according to a ranking by the World Economic Forum released on Wednesday.

The World Economic Forum's new Global Enabling Trade Index survey of 118 economies looked at ten factors impacting trade, such as tariffs, customs administration efficiency and availability of transport and communications infrastructure.

The forum ranked Hong Kong number one thanks to its "very open market" as well as a "secure and open business environment."

Singapore's open business environment was also complemented by a "highly efficient and transparent border administration" and a well-developed transport and communications infrastructure.

Third and fourth places were taken by Sweden and Norway respectively, while Canada was ranked fifth.

The world's largest economy United States, however, did not figure in the top ten, coming in at number 14, dragged down by its border administration, judged to be "lacking some efficiency."

"Customs procedures (in the United States) are seen as comparatively burdensome (ranked 42nd) and there is a relatively high cost to import (ranked 65th)," said the WEF.

Export giant China fared even worse, ranked just 48th, reflecting "underlying weaknesses in its economy and its trading regime."

"Above all, China is a fairly closed country. Although its economic success relies heavily on exports, imports are still severely inhibited by tariff and non-tariff barriers, despite the country's accession to the WTO," it said.

Fellow Asian giant India ranked even further down the list, at 71st place, due to its market access, which is rated as "severely restricted."

Brazil was not far behind India, at 80th place, as its markets remain "fairly closed, with tariffs... inhibiting goods imports."


Enabling Trade Index: Korea (Lots of room for improvement)
2008 (Rank out of 118)
Index:24 5.0
Market access: 72 4.1
Tariff and non-tariff barriers: 96 3.1
Proclivity to trade: 33 5.1
Border administration: 18 5.5
Efficiency of customs administration: 2 6.0
Efficiency of import-export procedures: 22 5.6
Transparency of border administration: 31 4.9
Transport and communications infrastructure: 19 5.2
Availability and quality of transport infrastructure: 30 4.6
Availability and quality of transport services: 12 5.3
Availability and use of ICTs: 8 5.8
Business environment: 30 5.0
Regulatory environment: 44 4.6
Physical security: 24 5.4
(Source: WEF 2008)

South Korean Strike Halts Trade Worth Almost $5 Billion

South Korean Strike Halts Trade Worth Almost $5 Billion
(Industry Week – Agence France-Presse)

Export-dependent South Korea said June 17 that a strike by container truck drivers in protest at soaring fuel prices has disrupted international trade worth almost five billion dollars. The stoppage by more than 13,000 drivers, in its fifth day, has crippled major ports and inland cargo terminals where containers are stacking up.

The Ministry of Knowledge Economy said the strike had affected exports worth $2.31 billion and imports worth $2.43 billion as of late June 16.

More than 23,000 construction drivers – largely those who drive dump trucks, bulldozers and concrete mixer lorries – have also downed tools since June 16 – also in protest at rising fuel prices.

The construction and container truckers want steps to cut fuel costs or to be able to raise their fees in the face of the soaring price of diesel. Some 20% of normal truck movements in and out of ports and cargo terminals was continuing, with the help of military drivers.

Five cabinet ministers at a press conference announced a 100 billion won (US$97 million) package to modernize the transport sector and improve truckers' welfare. Part will be spent on increasing the number of trucks fuelled by natural gas and some on toll fee discounts.

Officials at the largest port Busan fear the stoppage will hit its status as the region's main transhipment port as storage space fills up, the JoongAng Daily reported. "We worry that shipping companies will move their transhipment hubs to foreign ports," it quoted port authority marketing manager Kang Bu-Won as saying.

Local firms are beginning to face problems receiving raw materials and exporting finished goods. "Shipments have come to a halt now," a spokeswoman for steelmaker POSCO said. However she said the firm, as a precaution, had secured more raw materials than usual and increased supplies to customers before the stoppage began.

South Korea Strike Spreads; Ports Clogged

South Korea Strike Spreads; Ports Clogged
(Reuters – Jack Kim)

South Korean construction workers went on strike on Monday to press for cheaper fuel and higher pay, joining thousands of truckers who walked off the job last week, crippling the export-dependent country's ports.

More than 18,000 operators of construction machinery are also angry over the policies of President Lee Myung-bak, who came to office in a landslide victory but has seen his support plummet after an unpopular deal to resume imports of U.S. beef.

Adding to his woes, the militant Korean Confederation of Trade Unions (KCTU), which opposes Lee's privatisation and pension plans, is set to announce the results of its all-but-certain vote to go on strike later on Monday.

The strikes have so far cost the country $3.5 billion, according to the commerce ministry.

They come as Lee grapples with massive street protests that initially called for the repeal of the U.S. beef deal but broadened to attack a range of his policies.

The demonstrations, which have hit a lull in recent days, could reignite after the trade ministry said on Monday talks between South Korean officials and the United States to address public health concerns over the beef deal had broken down.

Lee's entire cabinet and all his top aides at the presidential office have offered to resign, and Lee is expected to replace a sizable number of them.

Unionised truckers represent only a small portion of the country's drivers but play a key role in moving goods in and out of ports. About 14,000 walked off the job on Friday after talks on higher pay and cheaper diesel broke down.

Movement of cargo containers through the country's biggest port of Busan picked up slightly due as replacement drivers were brought in, but remained precariously slow, with the port's container yard filled to 85% capacity, a port authority official said by telephone.

Lee has pledged to boost Asia's fourth-largest economy by 6% this year, which economists say is overly ambitious in the face of record high oil prices and a global slowdown.

Speaking to finance ministers from Asia and Europe on Monday, Lee warned the world economy was facing its gravest crisis in more than three decades and called for tighter coordination among regional organisations to tackle the problem.

Russia-China Trade Up 44% to $48 bln in 2007

Russia-China Trade Up 44% to $48 bln in 2007
(RIA Novosti)

Trade between Russia and China increased 44%, year-on-year, in 2007 to $48.2 billion, a Chinese government official said on Sunday.

Speaking at the 19th international fair for trade and economic cooperation in Harbin, Ling Ji, deputy director of the Europe department at China's Ministry of Commerce, said that bilateral trade between both countries continued to expand rapidly as it increased 39% in January-May 2008, year-on-year, to $22.1 billion.

Ji said that in 2007 China posted a surplus of $8.8 billion in trade with Russia for the first time in the past 15 years, adding that the country would also build up Russian imports to balance mutual trade.

Ji said the exports of Chinese electronics and engineering products to Russia in 2007 accounted for about 40% of total exports to Russia ($10.3 billion) while imports from Russia mostly included energy products and raw materials, which accounted for more than 90%.

Rosewood Case Study: Form CI1, Canada Customs Invoicing

Rosewood Case Study: Form CI1, Canada Customs Invoicing

Sending a sample:

A sample Form CI1, Canada Customs Invoice may be accessed at the Canada Border Services Agency website. I would first send this link and instruct the Brazilian exporter to print their required number of copies for practice and to be used as a guide in writing first and then type the necessary form out online which may then be printed in typed form all of which requires possible download of pdf adobe acrobat software reader.

Information on completing it:

This Form CI1 may be submitted together with commercial invoice and includes similar information in 25 points:

1. Vendor (name and address).
2. Date of direct shipment to Canada.
3. Other references (includes purchaser's order No.).
4. Consignee (name and address).
5. Purchaser's name and address (if other than consignee).
6. Country of transhipment.
7. Country of origin of goods.
8. Transportation: Mode and place of direct shipment to Canada.
9. Conditions of sale and terms of payment (i.e. sale, consignment shipment, leased goods, etc.).
10. Currency of settlement.
11. 12. Specification of commodities (kind of packages, marks and numbers, general
description and characteristics, i.e., grade, quality).
13. Unit price.
14. 15. Total packages.
16. Total weight - Invoice total.
17. Net Gross weight.
18. If any of fields 1 to 17 are included on an attached commercial invoice, check this box Commercial Invoice No.
19. Exporter's name and address (if other than vendor).
20. Originator (name and address).
21. Agency ruling (if applicable).
22. If fields 23 to 25 are not applicable, check this box.
23. If included in field 17 indicate amount:
i. transportation charges ii. construction charges iii. export packing
24. If not included in field add:
i. transportation charges ii. construction charges iii. export packing
25. Check (if applicable): i Royalty payments ii Purchaser supplied goods of services for production

Following completion of the form I would make a request for the Brazilian exporter to forward a copy to me for review of any possible discrepancies prior to documentary submission.

Rosewood Case Study: Export Documentation

Rosewood Case Study: Export Documentation

a)other documents necessary to fulfill documentary obligations in Rosewood export transaction to Mexico:

Commercial invoice: preferred as proforma invoice acts more as a quotation or price check on a product sent to a customer prior to shipment and pre-order rather than acting as a bill of sale. Multiple copies will be required to fufill any L/C credit transactions according to transferring and confirming bank requirements.

Export declarations (Forms B13-A/E-15): required in Canada for the export of most goods and probably likely required concerning potentially export controlled products like exotic wood veneers.

Customs invoice: should be in agreement in terms of valuation in both Canadian dollars and Mexican pesos especially in the case of a contract stipulated requirement regarding transaction currency.

Certificate of origin: could be tricky as these veneered products represent potentially multiple root sources of origin.

Clean onboard ocean bill of lading: multiple copies will be required to fufill any L/C credit transactions according to transferring and confirming bank requirements for evidence of title and trustee terms with a possible additional shipper's letter of instruction highly recommended.

Cargo insurance certificate: multiple copies will be required to fufill any L/C credit transactionsaccording to transferring and confirming bank requirements.

Additional certificates: Possibly required special health certificates concerning wood or agricultural products exports and trans-border regulations in Mexico.

Export/Import Trade Permits: may be required under NAFTA regulations.

Warranties or after-sales agreements: Possibly required according to Mexican import regulations.

Standards conformance certificates: Possibly required according to Mexican import regulations.

ATA Carnet: May or may not be applicable.

b) additional information required, or information to be presented differently:

Contact details: Email address absent from contact address. Useful and essential in our internet connected world. Also website to confirm pricing in case a tax or duties valuation check is made by Mexican Customs authorities.

Invoice Number: Should include Mexican customer's internal reference number to provide evidence that this order was indeed placed by the Minister of Trade's Office.

Name of Customer: The name of the Minister of Trade should be given as in the interm period between placement and delivery his or her position may have changed due to political events such as recent replacement of Canadian Minister of Trade Emerson in Canada.

Shipping Vessel: Should be named to fulfill insurance issuance requirements.

Date: In agreement with date no fixed date should be given however the arrival date should not exceed the date of validity of the L/C terms of payment.

Shipping weights (net and gross): required additions.

Cubic volume: addition required.

Insurance and shipping costs: addition required.

Validity period: addition required.

Total charges: addition required.

Currency of sale: US dollars commonly used however Mexican/Canadian transactions might prefer to specify payment in either of their national currencies as every currency transaction is processed in favour of the banks and not the customers. Why not limit the number of exchanges required?

Country of Origin: details may not be correct particularly the trans-national nature of exotic veneers.

Packing: No description indicates a problem in any or all insurance claims which may require inspection and if found negligent in such terms may void the insurance due to insufficient packing leading to damages or loss.

*Unrelated* Documentary Specialists ?:

Friday, June 20, 2008

STEP is currently recruiting for a Trade Development Specialist

Saskatchewan Trade & Export Partnership (STEP) is a unique public-private partnership led by industry and established as a non-profit corporation in 1996 by the Province of Saskatchewan. STEP works in partnership with Saskatchewan businesses to maximize commercial success in global ventures with a team of professionals delivering custom export solutions and market intelligence to member companies across the Province.

STEP is currently recruiting for a Trade Development Specialist - Agri-Value as part of their dynamic team of international marketing professionals. Reporting to the Director, Trade Development - Agri-Value, your role will be to promote STEP member export interests within the agri-value sector. You will undertake trade development activities to advance the interests of Saskatchewan exporters in markets around the world.

Primary responsibilities will include organizing outgoing trade missions, attracting international buyers to Saskatchewan, counseling members on their export plans, and working closely with market intelligence personnel within your team. You will be responsible for developing and implementing strategies and meeting your individual targets within the Agri-Value Trade Development Group. You will assist with international marketing intelligence activities to target markets with requirements and financial capability to purchase Saskatchewan products and services in conjunction with the team Market Intelligence Specialist. Your strong communication and team building skills will help you to work within the STEP organization, and more importantly, with member companies and international contacts. Your global network within the agri-value sector will assist you in helping STEP members develop and implement their international marketing plans in their pursuit of sales, contracts, and projects.

This is a full time permanent position.

To qualify, you will possess the following knowledge, skills and abilities:

Bachelor’s Degree or an equivalent combination of education and experience in the areas of international marketing and international sales.;

Minimum of three years of recent and relevant experience, preferably in the field of marketing agri-value products and technologies (i.e. agri-food, agricultural biotechnology, etc.);

Certified International Trade Professional (CITP) designation through the Forum for International Trade Training (FITT) is desirable.;

Ability to work both independently and under supervisor’s direction.;

Strong project and time management skills.;

Excellent interpersonal skills and a strong focus on client service with well developed communication skills.;

Strong knowledge of Saskatchewan export capabilities and international business practices.;

Thorough knowledge of federal and provincial policies and programs addressing trade development.;

Strong relationship building capability with senior executives of private companies and dealing with the highest levels of governments - locally, provincially, federally and internationally.;

Please note any added foreign language skills, if applicable

For more information or to apply, please email: - Please do not respond to FITT directly.

Thursday, June 19, 2008

- JOB OPPORTUNITY - Director, Business Development - Gulf Region


Director, Business Development - Gulf Region
Queen’s Executive Development Centre - Queen’s School of Business

Reporting to the Executive Director, QEDC and in consultation with senior Queen’s School of Business colleagues, the Director, Business Development Gulf Region is responsible for directing and managing programs, resources, and staff while identifying, pursuing, and generating new business opportunities in the Gulf Region. QEDC has targeted the Gulf Region as a base from which to develop an international line of business. The Director is responsible for maintaining and developing relationships with existing clients and partner organizations, continuing to grow the customer base, and driving both the revenue and profit side of the business in the Gulf Region.
• Responsible for the growth and overall management of School of Business executive education programs offered in the Gulf Region.
• Responsible for enhancing relationships with corporations and partners to maximize the customer base, and drive both the revenue and profit side of QEDC’s business.

• Masters degree in Business Administration, with five or more years experience in a business development capacity. Consideration will be given to the equivalent combination of education and experience.
• Significant experience in making and developing business-to-business contacts at a Senior Executive level, with an international perspective.
• Demonstrated experience in strategy development and implementation, budget and revenue forecasting, and program analysis.
• Demonstrated experience in a management role with skills in organizing, motivating, and directing staff, outside consultants, geographically-dispersed teams, and clients as required.
• A sound knowledge of the executive education market in the Gulf Region
• Knowledge of Queen’s School of Business or QEDC programs would be an asset.
• Demonstrated experience in complex budget management.
• Experience in responding to Request for Proposals (RFP), public speaking, and creating and conducting presentations.

Please contact:
Jillian McCullough
Program Manager, Gulf Region
Queen's Executive Development Centre - Dubai
Queen's University, Canada
+971 50 345 7200

Sunday, June 15, 2008

Where's my book?

I am still waiting for my book for this!

Rosewood Case Study: Legal Aspects of Rosewood's Sales in Mexico

Rosewood Case Study: Legal Aspects of Rosewood's Sales in Mexico

Key factors to consider with regard to the legal aspects of Rosewood’s sales transactions in Mexico:

The first concern is establishing a cost effective method of direct shipment which may be fully beyond Rosewood resources. However it may be preferred and more efficient in future. Therefore establishing a mutually beneficial and profitable contract with a local agent or distributor will be an essential legal hurdle.

The terms of agreement must meet Canadian and Mexican legal requirements and will implicate review of the contract by both Canadian and Mexican legal firms. For example, Rosewood must ensure that all products meet legislative certifications and safety standards for both nations. Failing to meet them will be costly. In distributor agreements legal liability terms must be clearly determined for the agent or distributor.

Definitions for terms of use, specificity of goods, effective validity dates, measures for damages in compliance issues, excape or exit clauses, force majeure clauses, mediation and arbitration laws, applicability of Geneva Convention or exclusions of terms of convention, terms excluded and agreed by both parties, specific prices of goods, terms of sale, terms of payment, currency of settlement, compliance terms and responsible parties for regulatory standards, codes, packaging and labelling laws, dispute resolution methods, warranty protection and product liability responsibilities must be discussed, negotiated, agreed and in compliance with both Canadian export and Mexican import trade laws.

The contract should also include terms of minimum stocking orders, parts orders and emergency or special order terms which are recommended as the distributor or agent must act in the interest of Rosewood according to these terms of contract.

By necessity these contracts must be explicit, are at times lengthliy and may take several revisions, modifications and translations to be mutually acceptable to both parties. Under negotiation they may often appear similar to the pattern of order offers, counter-offers and acceptances. Thus prior negotiation of terms must be included in selection of agent or distributor and research of indirect competitor contracts and terms should also be considered to ensure Rosewood is not missing essential clauses which could be considered legal loopholes creating disadvantages for the company. In contract terms operating in Mexico regardless of EDC recommendations Rosewood will be at a perennial disadvantage unless Mexicans are included in the management team at HQ there will always be an interpretation and legal context disadvantage.

Further inclusions and considerations recommended by John R. Jagoe at The Export Institute USA would be:

1. Regular and routine sales reports tabling requirements of products from Mexico to Rosewood HQ to assist in MRP/DRP scheduling.

2. Regular notifications regarding changes in governing Mexican regulations over product certification and licensing to allow Rosewood to modify product when necessary.

3. Ensuring Rosewood retains legal right to fulfill orders made directly from Mexican buyers to Rosewood Canada. This would allow an online presence for sales orders seperately from Mexican agent or distribution contracts (eventually such a market presence may preclude the needs of agency or distributorship as the market grows).

4. Minimum validity periods on all supply product quotations which will ensure agents or distributors may deliver a solid price quotation to customers. Short validity periods will harm Rosewood's image in foreign markets. Variables in pricing should be regular and forecast inot porduct pricing.

5. A flexible and cost-effective agent or distributor product education program specifying terms of education and frequency of training in-house or at Rosewood HQ. Nothing could be worse than an un-informed distributor or agent.

6. Terms of emergency repair or technical assistance Rosewood will provide on site in Mexico, maximum frequency of technical assistance and terms of visit.

7. Ensure exclusivity of product category. For example, it would not be in Rosewood's interest if Mexican distributor or agent was also stocking direct competitor's products.

8. Rosewood should expect to in addition to develop a personal and familiar relationship with Mexican agent or distributor, his family, and personal circle of business contacts in Mexico. Therefore Rosewood's management team should be prepared for at least biennial or triennial trips to Mexico to develop that relationship. Such extra-legal measures wille ensure mediation of contract is a ritual rather than a legal procedure as time progresses.

9. Steps to select an agent or distributor should be pragmatic and thorough. Nothing could be worse than the wrong legally contracted agent or distributor.

10. Regular review of performance and recommendations dialogue between Rosewood and agents or distributors to maximize sales in Mexico.

Saturday, June 14, 2008

Rosewood Case Study: Improvement of the inventory management system

Rosewood Case Study: Improvement of the inventory management system

Improvement of the inventory management system will require a long-term perspective on monitoring and managing the problem. Several strategies may be taken to improve Rosewood's situation.

Year-end inventory levels rising: Annual clearance sales of excess inventory may be a solution at such sites as many furnishing companies reduce warehousing by transferring disposal to allow costs to be absorbed. But this represents a short-term solution.

Carrying costs rising:

1. Re-evaluate customer service level required: Are short-lead times required in current and future export markets? How much of Rosewood's inventory may be localized to poinot of sale warehousing in disassembled shipping loads? How much finishing specialisation and options are required to satisfy customers? What is the most cost effective method of meeting customer needs in terms of inventory?

2. Channel Options: What are the best service options in terms of order cycle time (immediate requiring stockpiling versus direct delivery from Canadian manufacturer) or fill rate required (time required between production of each unit and required delivery time) and any possible costs for delay or immediate delivery cycles based on communication with customers. This would require further review of customer "moments of truth" in terms of satisfaction.

3. Overall Transportation Costs: Rosewood will have some serious decisions to make concerning line balancing inbound and outbound delivery schedules for all export traffic. Excesive stem point distances may already exist in terms of US markets, further distant Latin America will challenge Rosewood's current inventory management system exponentially. Warehousing for stockpiles in Rosewood's primary customer regions may already be a reality or soon a requirement. Securing and minimizing costs in the nearest markets will preapre Rosewood's management for configuring a cost effective system in proposed future markets.

4. Carrying Costs: Furniture carrying costs are described as quite low therefore Rosewood is expected to have larger stock volumes and more diversified stocking points at all times trying to carry as full loads as possible prior to customer delivery. Applying the economic order quantity variable may assist in determining where Rosewood may reduce carrying costs and generate higher liquidity of assets allocations. For example, reduced tax holding in maquilladora zones of Mexico may prove an ideal shipping destination for full-loads prior to redistribution to US customers which may be break-bulked and partially shipped through reimport freight forwarding facilities with other products manufactured there.

5. Inventory Handling: However whichever costs prove most effective choices ideally Rosewood's customers would be willing to wait for their premium designed and produced product. Reducing facilities costs with a relocation to Mexico would easily encourage Rosewood to do so with its labour cost savings and relocate the entire manufacturing facility to Mexico as well. However this is the paradox of North American production. Most small and medium sized manufacturers in Canada and the United States remain family run and managed. Very few of these entrepreneurs have fully divested themselves of an ethical and moral relationship to the communities of their origin. As a result while these remain candidates for relocation to Mexico they also represent a resistance to relocation as the essence of their management is localized and self-interested control of family assets. So far it appears emigration from rather than immigration to Mexico is the socio-cultural norm regardless of perceived cost savings.

Rosewood Case Study: Implications of producing for export to Mexico and other parts of Latin America

Rosewood Case Study: Implications of producing for export to Mexico and other parts of Latin America

A balance between market driven and manufacuring abilities research determines which products will be made available in foreign markets. Product modifications, packaging and reworking to meet local regulations, languages and differences in customer service requirements may simply answer the question based on costs. For many companies the costs out-weigh the benefits.

A simple anecdote may easily illustrate the differences in implications for customer driven versus manufacturing capabilities product placement in foreign markets. In 2004 while living in Busan I was looking for a specific product, a green-glass globed banker's desk lamp. Wandering from market to market and department store to department store it was impossible to find one. There were no varieties of green glass globed lamps anywhere let alone a standard or classic design of a banker's footed lamp. Finally purely by accident I wandered into a building which appeared to be a medium sized department store but upon closer inspection was seven floors of wholey imported Italian furniture.

Resembling a warehouse with retail sales prices displaying similarly repetitive stocks of similarly priced products I was surprised to discover similarly designed lamps, not at all what I was looking for, however of a substitution grade product. Upon closer inspection from shop to shop I was able to find a burnished brass lamp footed with dark burnished marble, nothing like intended purchase, but of a satisfactory price and design. Inspection of other Italian inspired import products recalled quality designs however the materials appeared of inferior workmanship and details finishing were rough-shod. It was difficult to determine original versus possible Chinese forgeries however all prices reflected perceived Italian origin.

However the questions remain:

Can minimal or no modifications of Rosewood products be made? This will keep costs down especially as new markets may be fraught with cyclical demand, sluggish sales and imitator products which could competitively capture consumer demands. For example, Dunkin' Donuts entry to Korea was soon followed by public market sold competitor products with imitation donuts inside a similarly coloured and styled box with the label, "Donald Donuts" for a fraction of the price.

Will current inventory management systems be able to supply the new market or will costly adjustments need to be made to production and supply chain demands? The ongoing beef saga regarding US sourced beef products as recently as two years ago required all beef imported from the US be devoid of bone fragments, which in US and Canadian meat processing facilities, may be impossible to support economically. One tiny centemes long fragment was found in a shipment a couple of years ago causing an entire quarantine of the entire flash frozen meat shipment (I for one would have gladly eaten of this cowed product).

Can necessary market modifications be made with current production and manufacturing technology? Following the Italian furniture encounter I wrote to Bass River Chairs to enquire after their export markets in Asia convinced they produce a better product. Their reply was that their facilities could not support exports, it had been tried before, and it was a fiasco. Bass River Chairs has since gone bankrupt.

Ease of transport/manufacturing? Furniture does not predispose itself to ease of export as my home furnishing shipping from Abu Dhabi may attest unless perhaps Rosewood may break-down its product into flat-pack home assembly units as at Ikea. Being able to do so would implicate Ikea pricing.

Features, Options, Local Requirements? Mexico and Latin America have yet to provide specific research on customer demands regarding veneered office products. This could prove very costly as Mexico is not a similar market either to Canada or to the USA. It could in fact prove a black-hole in terms of costs just as some clothing manufacturers such as Giordano have found when attempting to market a global annual collection. Portions of China and Germany have proven to be markets to exit in terms of minimizing local rework, modifications and redesign. Export products often succeed where minimal modifications are required.

Feasibility and pertinence of implementing DRP and/or MRP processes:

Both entirely relevant to Rosewood in terms of distance between manufacturer and Latin American consumers. Great distances and time for delivery exist perhaps reduced with a FTZ stocking warehouse in Florida (which may suffer from excessive shrinkage however). Review of these systems may have a net benefit for current market costs savings as well.

Distribution Requirements Planning (DRP): Overarching concerns regarding finished product distribution. How shall Rosewood strategize minimal costs for distribution to Latin American customers? Where and what sized warehousing or stocking inventories will be required? How much time will be required to trans-ship products from central housing to customer regional locations in SA? How will economies of scale in load bearing and load volumes match customer demand, exceed costs, and generate profits? Feasible but cost effective?

Forecasting, Gross Demand, On-hand, On-order Inventory Requirements: Assuming Rosewood has already put such measures in place, do they possess a similar effective grasp of Latin purchasing demands to provide necessary precedence for forecasts of that demand? Are time periods and cycles of purchase in Latin America available? Will measures be similar or dissimilar to current export markets? Is there an opportunity to divert excess inventory to Latin America rather than liquidate through clearance? What portions of Latin American markets will determine fixed or variable demands for the master schedule? Will schedule forecasts actually satsify the master demand schedule on an ongoing basis or will costly modifications of that schedule be necessary?

Materials Requirements Planning (MRP): What portion of a customer's order may be flat-packed to minimize shipment volumes? What raw materials may be direct ordered from overseas suppliers and delivered to FTZ Miami for component system assembly at the warehouse there? What scheduling requirements exist to effectively manage Latin American orders? Will the costs of reorganising the schedule be offset by profits in the Latin American market? Again feasible and pertinent but is there a profits based reward?

Strike by truckers paralyzes South Korean ports

Strike by truckers paralyzes South Korean ports (IHT)
By Choe Sang-Hun Published: June 13, 2008

SEOUL: More than 11,000 South Korean truck drivers went on strike Friday to protest rising fuel prices, paralyzing ports and cargo terminals and challenging the already unpopular new government of President Lee Myung Bak.

Across Asia, as in the rest of the world, sharp increases in fuel prices continued to stoke public anger Friday. In Malaysia and Thailand, consumers and truckers demanding more fuel subsidies from their governments threatened to strike and Thai fishermen warned that they would burn their boats.

Tension grew around major ports in export-dependent South Korea as striking truckers blocked entrances and the police vowed to escort nonstriking drivers through the blockades. Television broadcasts showed freight yards filled with shipping containers as trucks stood idle.

After small-scale work stoppages in the past week, members of the Korea Cargo Transport Workers Union went on full strike Friday, demanding that the government lower diesel-fuel costs, raise fees for hauling freight and introduce minimum wages for truckers.

"The government intends to use whatever means necessary to end this transportation crisis as soon as possible and minimize its impact on the national economy," Prime Minister Han Seung Soo said.

The disruptions to freight transport have only added to Lee's political troubles. In December he won election with a promise to reinvigorate the slowing economy by achieving a growth rate of 6 percent this year, a task economists now consider overly ambitious in the face of record oil prices and a global slowdown.

In a separate protest Friday, thousands of people rallied in downtown Seoul to denounce Lee's agreement in April to lift the ban on the importation of American beef, continuing a month-long protest that prompted his entire cabinet to offer to resign.

The government recently announced a $9.77 billion package to help people deal with record-breaking oil costs, but that did little to appease the truck drivers.

The government warned that it would arrest drivers if they attempted to block nonstriking truckers from picking up cargo. The Ministry of Land, Transport and Maritime Affairs confirmed Friday that it would immediately revoke the annual fuel subsidy payments of about 15 million won, or $14,500, for striking truckers.

"If the government arrests any of the striking truckers, our member unions will immediately launch nationwide strikes," said Lee Seok Haeng, head of the Korean Confederation of Trade Unions. The labor group has often led crippling labor strikes in auto and other crucial industries. With the traditional season for negotiating under way, unions have seized on the president's unpopularity to increase their leverage.

A two-week strike by truckers in 2003 cost exporters 540 billion won, or $519 million at today's exchange rates, Han said, citing figures from the Korea International Trade Association. He predicted that this strike would cost 128 billion won in export losses a day.

In the ports of Busan in the southeastern tip of South Korea, the number of operating trucks dwindled to 13 percent of normal levels. The Busan ports handle 76 percent of South Korean container traffic.

"We mostly use nonunion trucks, but the problem is that we can't load or unload our cargo because the gates of the terminals are blocked by striking drivers," a spokeswoman at Posco, the leading South Korean steel maker, said, asking not to be identified by name because of company policy.

The government said it would use military vehicles and increase rail service to keep factories running and ease the paralysis at the ports. But rail unions said Friday that they would not cooperate.

The 14,000 unionized truckers represent only 3 percent of total cargo drivers in South Korea, but they handle more than 20 percent of the total container traffic. Unlike in previous strikes, the current walkout has attracted nonunion members fighting for their own livelihood.

"At the current fuel price level, there is no point for me to drive my truck," said Kim Jin Soo, a nonunion truck driver in Busan. "The more I drive, the more money I lose. How am I going to pay my two daughters' college tuition?"

In Europe, tens of thousands of truck drivers struck this week in Spain, Portugal and France to demand government help to cope with fuel costs.

Their protests have paralyzed roads and left supermarkets short of fresh produce and some gas stations without supplies.

In Malaysia, hundreds of people marched through Kuala Lumpur on Friday, demanding that the government reverse a steep hike in fuel prices or step down, in the biggest protest yet against the coalition led by Prime Minister Abdullah Badawi.

"Down with PM, long live the people," the protesters shouted, Reuters reported. Hundreds of police officers in riot gear stood guard, highlighting the uneasy time for Abdullah, who was reeling after a dismal electoral performance in March.

Friday, June 13, 2008

Let Taiwan Join Global Bodies, U.S. Tells China

Let Taiwan Join Global Bodies, U.S. Tells China
(Taipei Times)

A senior U.S. State Department official on Wednesday called on China to allow Taiwan to “play a full role” in international organizations in response to initiatives taken by President Ma Ying-jeou’s (???) government to ease cross-strait tensions.

Deputy Assistant Secretary of State for East Asian and Pacific Affairs Thomas Christensen said the U.S. hoped that the Ma government’s policies would lead Beijing to adopt a more “expansive” policy in relation to Taiwan’s role in the world community.

Christensen made his comments while testifying before a congressional hearing on China’s relations with Africa.

“We’re hopeful that the warming trend in cross-strait relations will lead the government in Beijing to realize that it is in the long-term interest of stability across the Strait and in the long-term interest of international peace for Taiwan to play a full role on the international stage,” he said.

Christensen was responding to a question about China’s intensive efforts to deny Taiwan diplomatic recognition in Africa, where only four nations recognize Taiwan instead of China, and where China’s often heavy-handed commercial activities have generated resentment.

“I think in general there are optimistic trends in cross-strait relations that may lead to more expansive and open policies by the mainland [sic] toward Taiwan in cross-strait relations, and also toward Taiwan in the international community, to provide Taiwan with more international space, and we push for this as part of our policy. That includes Taiwan’s international space in international organizations,” he said.

Asked by reporters after the hearing whether he thought China would relent in its opposition to Taiwan’s participation in the WHO, Christensen said: “This is something for the future.” He added: “We’re urging them to do this. We take some optimism from the trends across the Strait ... [but] how that will play out over time, we’ll have to see.”

Asked about reports that China may be willing to reducing its 1,300 missiles aimed at Taiwan, Christensen said he had not seen such reports. “We’re hopeful that that will happen in the future, but that’s a goal. I don’t have anything to report to date,” he said.

In his testimony, Christensen said that one of China’s three goals in Africa was to deny diplomatic space to Taiwan. The others were a search for resources and for “prestige.” He and committee members said that while China employs the principle of non-interference in African countries’ affairs in foreign aid, commerce and investment, the one exception was its opposition to diplomatic recognition for Taiwan.

David Emerson: The Prime Minister's Silver Bullet

David Emerson: The Prime Minister's Silver Bullet
(Globe and Mail – Neil Reynolds)

Finally, we have a Minister of Foreign Affairs with the gravitas that a G7 country requires. And the skill set that goes with it. As perhaps the most competent minister at Prime Minister Stephen Harper's disposal, David Emerson was the perfect choice to replace Maxime Bernier, perhaps the least competent.

We should all thank Mr. Bernier for leaving his classified dossier at his girlfriend's place (and forgetting it for the next five weeks), enabling Mr. Harper to bring the embarrassment of the Bernier Bungle (August 2007-May 2008) to a quick, decisive and merciful end.

Having appointed Mr. Bernier for the wrong reasons, the Prime Minister was presumably relieved to dis-appoint him for the right ones.

Ironically, the elevation of Mr. Emerson gives the Bernier Bungle its only lasting importance. It affirms now that quiet leadership, solid performance and authentic achievement are career-enhancing attributes in the ministerial ranks of this government. It promises competent management – on an interim basis, at least – in the departments of external affairs and international trade.

Equally important, perhaps, it puts the right person in the right place to deal with the protectionist administration that Democrat presidential candidate Barack Obama promises to install in Washington next January. Complete Column

Canada-Colombia FTA

Canada-Colombia FTA
(Foreign Affairs & International Trade Canada)

On June 7, 2008, Canada concluded free trade agreement (FTA) negotiations with Colombia, as well as negotiations for an Agreement on the Environment and a Labour Cooperation Agreement. The conclusion of these agreements delivers on Prime Minister Stephen Harper's commitment to Canada's re-engagement in the Americas. Once implemented the agreements will expand Canada-Colombia trade and investment, and will help solidify our bilateral relationship.

Now that negotiations are concluded, a legal review of the negotiated texts will be carried out. Following the legal review, the agreements will be signed by the parties, released to the public, and proceed to each country’s respective legislative bodies for ratification. To allow the agreements to enter into force in Canada, the treaties will be tabled in the House of Commons for a period of 21 sitting days, after which the legislation to implement the treaties will be tabled in Parliament.

Benefits for Canada

Colombia is an established and growing market for Canadian exporters (e.g. wheat, pulses, barley, chemicals, paper products, and heavy equipment) and services providers (mining, oil and gas, engineering, information and communication sectors), as well as a strategic destination for Canadian direct investments (mining, oil exploration, printing and education).

Once implemented, the FTA with Colombia will stimulate the growth of our commercial relationship and help level the playing field for Canadian business vis-à-vis competitors who have or are seeking preferential market access in Colombia.

The FTA will also promote a more stable and predictable investment environment in Colombia.

Complete Announcement

Surging Export Volumes Continue to Create Outbound Logistics Pressures

Surging Export Volumes Continue to Create Outbound Logistics Pressures
(Supply Chain Digest)

With the falling U.S. dollar, U.S. export volumes have continued to strengthen – good for many US-based companies, but creating a variety of challenges in terms of export logistics.

The inbound global supply chain continues to present challenges to many Western companies, but in some respects, with flat or declining import container volumes, the pure inbound logistics execution issues have moderated substantially due to more capacity throughout the supply chain. The exact opposite has occurred in export logistics.

Georgia-Pacific’s buildings products unit is a prime example. In recent times, its international sales and export volumes have risen dramatically – but fulfilling those orders has become increasingly challenging.

“In this environment, it’s critical to well communicate how outbound logistics works to customers and your sales team,” said Lloyd Rich, director of Import/Export and Compliance for Georgia Pacific (GP), at a recent meeting of the Atlanta CSCMP roundtable. “For example, just because you have a “booking” on an ocean container doesn’t guarantee the space or the departure.”

In fact, just getting sufficient outbound containers for shipping continues to be a real supply chain constraint for many companies. A large percentage of the export volumes from the US are coming from inland regions or other areas far away from the major inbound ports, such as LA/Long Beach. Getting them to where they are needed for export is itself a huge logistics and cost challenge.

Agricultural exports are a big source of the outbound volume growth and focal point of the container shortage. U.S. agricultural exports have jumped 20% by weight in the six months ending Feb. 29, compared with the same period last year, according to the Department of Agriculture.

But they might have been even more, if not for these logistics constraints. For example, Peter Friedman, executive director of the Agricultural Transportation Coalition, believes agricultural exporters could have shipped 20 to 30% more products in the past six months if more shipping containers were available. Other companies are similarly reporting lost sales due to container shortages.

GP’s Rich also said it is critical for shippers to monitor export container availability at key ports to have the best chance of catching potential container shortage issues before it’s too late.

Even if exporters secure the booking and the containers, stuff happens – and ocean carriers are much less likely today to try to catch up to the schedule as a result of the tremendous rise in fuel costs. “The ships are slowing their average speeds down to save on fuel,” Rich said. “The will not speed up now as they did in the past to try to make up lost schedule time.”

Container availability and shipping capacities/schedules are two key issues. Inevitably, cost increases are also a growing concern, as fuel surcharges rise and guaranteed pricing windows shrink.

“The rate validity with the ocean carriers is now one quarter, and it may go less than that,” Rich said. “Not long ago, the rate you paid could be locked in 6-12 months. We’re lucky to get one quarter now.”

Obviously, this environment can play havoc with absolute logistics costs and costs relative to budget – and ultimately to the bottom line.

Latin American Economic Growth Could Approach Five Percent This Year

Latin American Economic Growth Could Approach Five Percent This Year
(World Trade Interactive)

According to a recent report by the Economic Commission for Latin America and the Caribbean (CEPAL), economic growth in Latin America is expected to slow to 4.7% in 2008 from 5.7% in 2007. Individual country forecasts range from 2.7% for Mexico to 8% for Panama. Peru and Argentina will show significant progress, with gross domestic product increases of 7%, followed by Uruguay at 6.5%, Colombia and Venezuela at 6%, Bolivia and Paraguay at 5%, Brazil at 4.8% and Chile at 4.5%.

CEPAL Executive Secretary Jose Luis Machinea said the anticipated slowdown in regional growth is due to several factors. One is the U.S. economy, which Machinea expects to go through a soft recession this year due to the decline in the domestic housing market. While this will put pressure on the region’s poorer countries as well as industries that rely on exporting manufactured products to the U.S., he said, overall the impact on Latin America will not be significant. Economic expansion will be hindered by increasing prices for food and fuel as well.

D&B Report Says Indian Exports to Non-U.S. Markets Increasing

D&B Report Says Indian Exports to Non-U.S. Markets Increasing
(Economic Times, India)

The trend of India's exports is shifting from the traditional U.S. market to the UAE, a Dun & Bradstreet report said.

The U.S. has traditionally been India's leading export destination and in FY 07 too, it accounted for as much as 14.9% of the total merchandise exports worth an estimated USD 18.9-billion, the report said.

Even though the U.S. share in India's merchandise exports dwindled from 20.7% in FY 03 to 14.9% in FY 07, in value terms it increased from USD 10.9-billion to USD 18.9-billion. "This was also an indication of India's growing preference for trading with other emerging markets by diversifying its product group and improving its quality, etc," the report said.

The UAE which is the second-largest export market, accounted for 9.5% of the country's total exports in FY 07, while in FY 03 it accounted for 6.3% only, the report said. The spurt in exports to the UAE can be largely attributed to a rise in exports of mineral fuels, mineral oils and products, which constituted almost 30.4% of total exports to the UAE, the report said. UAE is also an important market for re-export in the entire Middle East region and in 2005, its total re-export was as high as USD 26.4-billion, it said.

India's exports to China have also seen a rapid growth from just 3.7% in FY 03 to 6.6% in FY 07. India's export share to Singapore has gone up from around 2% in FY 01 to 4.8% in FY 07.

Report Forecasts Higher Food Prices for Next Decade

Report Forecasts Higher Food Prices for Next Decade
(International Herald Tribune – Andrew Martin)

Record prices for farm crops should gradually recede, but they will remain substantially higher than average over the next decade because of fundamental changes in demand, according to a report released Thursday by the United Nations and the Organization for Economic Cooperation and Development.

Because the recent spike in crop and food prices has been caused in part by temporary factors like drought, the report predicted that prices should decrease as weather conditions return to normal and crop yields improve.

"At least we hope they are temporary," said Angel Gurria, secretary general of the OECD, alluding to the potential impact of climate change on agricultural production.

The report was critical of government policies that encouraged biofuel production, saying that their environmental, energy security and economic benefits were modest at best and "sometimes even negative." And the report suggested that those policies should be re-examined in light of the current food crisis, as should government trade policies like export bans that do not allow farmers to take advantage of higher global prices for agriculture commodities. The report also encouraged countries that have balked at allowing genetically modified crops to reconsider their use as a way to improve yields.

In a related matter, the World Bank on Thursday announced that it would increase its spending on agriculture and food programs to $6 billion in the coming fiscal year, which begins July 1, up from $4 billion. The additional money includes $800 million that has already been earmarked for Africa and an additional $1.2 billion to rapidly finance things like seeds, fertilizer and irrigation for small-scale farmers, food for work programs and school feeding initiatives.

"These initiatives will help address the immediate danger of hunger and malnutrition for the two billion people struggling to survive in the face of rising food prices," the president of the World Bank Group, Robert Zoellick said, in a statement.

According to the report by the OECD and the Food and Agriculture Organization of the United Nations, released Thursday in Paris, the anticipated causes of higher than average prices during the next decade include a doubling of biofuel production, higher fuel costs that increase the cost of producing crops and food and greater demand for food and animal feed in developing countries where incomes are rising. …

Read the complete article at

Slow Freight Growth for Asia-Pac Carriers

Slow Freight Growth for Asia-Pac Carriers
(Cargonews Asia)

International freight traffic carried by Association of Asia Pacific Airlines (AAPA) grew just 2.1 percent in April. However, the average cargo load factor for the month gained 1.6 percentage points to 67.2%, on a 0.3% reduction in offered capacity.

“Airlines around the world are struggling to cope with the impact of runaway oil prices, amidst signs of weakening demand growth, for both business and leisure traffic,” said Andrew Herdman, AAPA’s director-general. “Sharply higher fuel costs are inevitably driving up the cost of travel. Meanwhile, airlines are looking to cut back poorly performing routes, whilst maximising their utilisation of more fuel-efficient aircraft. Nevertheless, after the doubling of oil prices over the past year, there is no sign of any respite from the current challenges.”

U.S. Exporters Face New Hurdle at Home: Full Ships

U.S. Exporters Face New Hurdle at Home: Full Ships
(The Guardian – James B. Kelleher, Reuters)
As U.S. exporters scramble to meet the increased demand for their products created by the weak U.S. dollar, they are running into an unexpected snag: space on ships leaving U.S. ports is suddenly scarce.

So the country's farmers, chemical companies, machinery makers and other exporters are facing delays dockside that erode the currency advantage they enjoy over foreign rivals. Or they end up paying a premium for space that until recently shippers were almost giving away, producers and shippers say.

Timothy Powers, chief executive of Hubbell Inc, an Orange, Connecticut-based electronics maker, told investors this week that in March, his company saw East Coast wait times for cargo space jump from two days to three weeks. "There's a constraint on out-bound containers," he said.

Part of the problem is the weak dollar, which has boosted overseas demand for cheaper U.S.-made products even as it sent costlier imports lower, industry experts and executives say. That's reversed a long-term trend in trade and thrown shippers off balance.

But Brian Conrad, spokesman for the WTSA, a trade group representing major shippers operating between the United States and Asia, says other factors are contributing to the problem, including a surge in demand for U.S. farm goods, many of which are now shipped in containers rather than bulk cargo ships.

Soaring fuel prices also are contributing to the shortage of containers, especially in the nation's interior. That's where most of the agricultural exports are grown. But it's often a thousand miles away from the distribution centers in California and New York where most inbound containers are unloaded.

"It's a more severe problem the further you are away from a port," said Don Westfall, who monitors logistics issues for the Manufacturers Alliance/MAPI trade group.

In the past, shippers would send the empty containers to such remote areas at their own expense. But with trucking companies and railroads slapping steep surcharges on customers to deal with surging diesel prices, Conrad said: "The carriers are asking themselves, 'Does it really pay for us to be moving an empty container at our own expense?'" At a time when other trade routes are booming, the answer, increasingly, is no."For every piece of equipment the carriers have, there are three or four markets where someone is saying, 'I need that container here," Conrad said.

Container Shortage a Weighty Issue

Given the fact that the United States runs a huge trade deficit and imports twice what it exports, it seems odd that the country's exporters would have any difficulty finding space aboard vessels headed overseas. Indeed, for every one container that the U.S. exports, it imports two-and-a-half, according to industry figures.

But the goods the U.S. exports – grains, heavy machinery, chemical products and scrap metal – tend to weigh a lot more than the consumer products it imports.

"The main stuff we import from Asia is clothing and electronics," Conrad said. "That's quite light cargo and you can put a lot of those containers on the ship before it deadweights out. By contrast, export cargo is very heavy ... So you can't put as much of it on the ship."

All of that is creating a headache for exporters, and may help explain why the Commerce Department was forced on Thursday to sharply revise lower its estimate of first-quarter export growth. But not everyone is being affected the same way.

"Generally speaking, what I'm hearing is a moderate level of disruption for some, none for others," said Westfall, who polled Manufacturers Alliance/MAPI members this week. "The weak dollar has tipped things in favor of exports rather quickly and so you've suddenly got a lot of people who were not major exporters trying to export – and you've got fewer ships coming into the United States laden with cargo."

Take the Port of Los Angeles, one of the nation's busiest. In April, the number of outbound loaded containers leaving the port was up 20% from last year. But the number of inbound loaded containers was down almost 11%. Some containers still left LA empty, but that volume was down 30% from last year. "That's the dramatic shift right there," said port spokeswoman Theresa Adams Lopez. In the old days, she said, "that's primarily what we were exporting – empty containers."

With their vessels suddenly filling up, the carriers are beginning to play hardball, especially with smaller exporters. The people who are having problems "have contractual issues, where they negotiated special discounts with the steam ship lines. Now they can't get space on the ships because the lines are saying they only allocated so much space to those fares," Westfall said. "It's like the airlines, where there are only a certain number of discounted seats."