“STUDY ON THE CRITERIA FOR THE C.H.

A (CUSTOM HOUSE
AGENT) IN SELECTING A CFS (CONTAINER FREIGHT STATION)
CONTENTS

PAGE NO.
S.NO TITLE

1. INTRODUCTION 1
1.1. NEED FOR THE STUDY 2
1.2. STATEMENT OF PROBLEM
2
1.3. INDUSTRY PROFILE
1.4. COMPANY PROFILE 3-11
1.5 FREIGHT FORWARDING PROCESS CHART 11-24
25-27
STATEMENT OF OBJECTIVES
2. 28
REVIEW OF LITERATURE
3. 3.1 FACTS ABOUT CFS IN CHENNAI 29-33
34-35
RESEARCH METHODOLOGY
4. 4.1. RESEARCH DESIGN 36
4.2. SAMPLE SIZE 37
4.3. SAMPLING METHOD 37
4.4. PERIOD OF THE STUDY 37
4.5. METHOD OF DATA COLLECTION 37
4.6. SCOPE OF THE STUDY 37
4.7. LIMITATIONS OF THE STUDY 40
40
DATA ANALYSIS & INTERPRETATION
5. SWOT ANAYSIS 41-59
63-64
FINDINGS
6. 65-66
 SUGGESTIONS
7 67
CONCLUSION
8 68
BIBLIOGRAPHY
69
ANNEXURE

CHAPTER 1
 INTRODUCTION

This project is based on analyzing the effectiveness of container freight stations (CFS) in
Chennai and the criteria for the custom house agent(C.H.A)to select a CFS.Reports show that
there about 30 Container Freight Stations in Chennai, and there are more than 500 Custom House
Agents in Chennai. The statistics also show that nearly 90% of the C.H.A do their business in
ocean freight transport and they are located in North Chennai(Parrys,Royapuram,Broadway). In
this project I have analyzed the facilities offered by the CFS, EXIM rate done by the CFS in
Chennai, TEU handling capacity etc. (fig
Definitions of Logistics:

The American Council of Logistics Management defines logistics as “the process of

planning, implementing and controlling the efficient, cost effective flow and storage of raw
materials, in-process inventory, finished goods and related information from point of origin
to point of consumption for the purpose of conforming to customers’ requirements”.

Philip Kotler defines logistics as “planning, implementing, and controlling the physical
flows of materials and finished goods from point of origin to point of use to meet the
customer’s need at a profit”.

Objectives of logistics:

Logistics has the following objectives:

Reduction of inventory: Inventory is one of the key factors, which can affect the profit of
an enterprise to a great extent. In the traditional system, firms had to carry lot of inventory
for satisfying the customer and to ensure excellent customer service. But, when funds are
blocked in inventory, they cannot be used for other productive purposes. These costs will
drain the enterprise’s profit. Logistics helps in maintaining inventory at the lowest level, and
thus achieving the customer goal. This is done through small, but frequent supplies.

Economy of freight: Freight is a major source of cost in logistics. This can be reduced by
following measures like selecting the proper mode of transport, consolidation of freight,
route planning, long distance shipments etc.

Reliability and consistency in delivery performance: Material required by the customer

must be delivered on time, not ahead of the schedule or behind the schedule. Proper planning
of the transportation modes, with availability of inventory will ensure this.

Minimum damage to products: Sometimes products may be damaged due to improper

packing, frequent handling of consignment, and other reasons. This damage adds to the
logistics cost. The use of proper logistical packaging, mechanized material handling
equipment, etc will reduce this damage.

Quicker and faster response: A firm must have the capability to extend service to the
customer in the shortest time frame. By utilizing the latest technologies in processing
information and communication will improve the decision making, and thus enable the
enterprise to be flexible enough so that the firm can fulfill customer requirements, in the
shortest possible time frame.

The various functions of logistics are as follows:

1. Order Processing: Processing the orders received from the customers is an activity,
which is very important by itself and also consumes a lot of time and paperwork. It
involves steps like checking the order for any deviations in the agreed or negotiated
terms, price, payment and delivery terms, checking if the materials is available in stock,
producing and scheduling the material for shortages, and also giving acknowledgement to
the owner, by indicating any deviations.
 2. Inventory Planning and management: Planning the inventory can help an organization
in maintaining an optimal level of inventory which will also help in satisfying the
customer. Activities like inventory forecasting, engineering the order quantity,
optimization the level of service, proper deployment of inventory etc. are involved in this.

3. Warehousing: This serves as the place where the finished goods are stored before they
are sold to the customers finally. This is a major cost center and improper warehouse
management will create a host of problems.

4. Transportation: Helps in physical movement of the goods to the customers place. This
is done through various modes like rail, road, air, sea etc.

5. Packaging: A critical element in the physical distribution of the product, which also
influences the efficiency of the logistical system.

Logistics delivers value to the customer through three main phases:

a. Inbound logistics: These are the operations, which precede manufacturing. These include
the movement of raw materials, and components for processing from suppliers.
b. Process logistics: These are the operations, which are directly related to processing.
These include activities like storage and movement of raw materials, components within
the manufacturing premises.
c. Outbound logistics: These are the operations, which follow the production process. These
include activities like warehousing, transportation, and inventory management of finished
goods.

Logistics Solution:

Generally, the in-house logistics departments in manufacturing organizations take care of all
aspects of logistics. But this is not an area of core competency of manufacturing or trading
organizations. Today, a lot of successful business corporations across the world are
 outsourcing logistics to the third party logistics providers, who are having the necessary
infrastructure and expertise to do the job in a better manner. Complete logistics solutions to
manufacturers and traders is provided by the third party logistics providers, and they help in
integrating various logistics operations, thus ensuring speedy and uniform movement of
materials across the supply chain.

Logistics is nowadays widely used in virtually every area. The success of a logistics service
providing company depends on how they conceptualize and implement the logistics solution,
and also tune to the requirements of the customer.

Future of Logistics

Nowadays corporations look only for sustainable competitive advantage, not only for
growth, but also to survive. There is so much killing competition that corporations are
compelled to review their business process while they deliver the products and services to
customers, who are looking for more and more value for the money that they are spending.
The focus of competition has shifted from the product to the supply chain.

Today, logistics management is based on the system concept and cost approach.
Transportation, warehousing, handling of material, inventory management and order
processing are the major logistics activities, which impact the customer cost and operation.
Integrated logistics helps in taking the cost out of the supply chain and also enhance the
customer service level.

When looking at the macro level, a growth of a country’s economy depends on the
availability of excellent logistics infrastructure. The speed of the movement of goods
depends to a great extent on the various modes of transportation like rail, road, air, and sea.

Logistics has a bright future, especially in India of rationalization of customs formalities,

improvement in road and rail infrastructure, creation of modern warehouse facilities etc, have to
be taken care of. The geographical position of India also is well positioned to emerge as an
excellent hub for a variety of products.
1.1 NEED OF THE STUDY

Freight Forwarders play a vital role in transacting the goods along with doing all the
documentation work on behalf of the Exporters/Importers. Freight Forwarders are applying
different formula for the effective Logistics business transaction.

The study aims at analyzing the functioning of the CHA and giving suggestions for
improving their services. It throws light on container handling at the company and also the
problems faced by Freight Forwarders with regard to the container handling

1.2 STATEMENT OF THE PROBLEM

 As there are 30 CFSs in Chennai, does all CFSs satisfies all the requirements of the
C.H.As
 Does all the CFSs in Chennai satisfies infrastructure facilities required by the CFS
 Will there be any effect on CFS business due to the upcoming Ennore port

1.3 INDUSTRY PROFILE

DEFINITION OF ICD/CFS
 Inland Container Depot / Container Freight Station may be defined as“A common user
facility with public authority status equipped with fixed installations and offering services for
handling and temporary storage of import/export laden and empty containers carried under
customs control and with Customs and other agencies competent to clear goods for home use,
warehousing, temporary admissions, re-export, temporary storage for onward transit and outright
export”. Transshipment of cargo can also take place from such stations.

DISTINCTION BETWEEN AN ICD and A CFS

Functionally there is no distinction between an ICD/CFS as both are transit facilities,

which offer services for containerization of break bulk cargo and vice-versa. These could be
served by rail and/ or road transport. An ICD is generally located in the interiors (outside the port
towns) of the country away from the servicing ports. CFS, on the other hand, is an off dock
facility located near the servicing ports which helps in decongesting the port by shifting cargo
and Customs related activities outside the port area. CFSs are largely expected to deal with
break-bulk cargo originating/terminating in the immediate hinterland of a port any may also deal
with rail borne traffic to and from inland locations.

Keeping in view the requirements of Customs Act, and need to introduce clarity in
nomenclature, all containers terminal facilities in the hinterland would be designated as "ICDs".

FUNCTIONs OF ICDs/CFSs

The primary functions of ICD/CFS may be summed up as under:

a. Receipt and dispatch/delivery of cargo.

b. Stuffing and stripping of containers.
c. Transit operations by rail/road to and from serving ports.
d. Customs clearance.
e. Consolidation and desegregation of LCL cargo.
f. Temporary storage of cargo and containers.
g. Reworking of containers.
h. Maintenance and repair of container units.
The operations of the ICDs/CFSs revolve around the following centers of activity:

I ) Rail Siding (in case of a rail based terminal)

The place where container trains are received dispatched and handled in a terminal.
Similarly, the containers are loaded on and unloaded from rail wagons at the siding through
overhead cranes and / or other lifting equipment.

ii) Container Yard

Container yard occupies the largest area in the ICD.CFS. It is stacking area were the
export containers are aggregated prior to dispatch to port; import containers are stored till
Customs clearance and where empties await onward movement. Likewise, some stacking areas
are earmarked for keeping special containers such as refrigerated, hazardous, overweight/over-
length, etc.

iii) Warehouse

A covered space/shed where export cargo is received and import cargo stored/delivered;
containers are stuffed/stripped or reworked; LCL exports are consolidated and import LCLs are
unpacked; and cargo is physically examined by Customs. Export and import consignments are
generally handled either at separate areas in a warehouse or in different nominated
warehouses/sheds

iv) Gate Complex

The gate complex regulates the entry and exists of road vehicles carrying cargo and
containers through the terminal. It is place where documentation, security and container
inspection procedures are undertaken.

BENEFITS OF ICDs/CFSs

The benefits as envisaged from an ICD/CFS are as follows:

1. The main benefits from ICDs/CFSs

 2. Concentration points for long distance cargoes and its unitization.
3. Service as a transit facility.
4. Customs clearance facility available near the centers of production and consumption
5. Reduced level of demurrage and pilferage.
6. No Customs required at gateway ports.
7. Issuance of through bill of lading by shipping lines, hereby resuming full liability of
shipments.
8. Reduced overall level of empty container movement.
9. Competitive transport cost.
10. Reduced inventory cost.
11. Increased trade flows.

PRIOR SURVEY A MUST

For the ICD/CFS to be successful, reduction in total transport cost is a prime criterion, as
there is a possibility of marginal increase in total handling cost per box on origin to destination
basis. This underlines the need for sound economic justification for setting up ICD/CFS through
a carefully evaluated traffic likely to be handled at the proposed facility. A survey/feasibility
study must precede the setting up of all ICDs/CFSs and copy of the report should invariably
accompany the application for setting up such a facility. Data for carrying out analysis could be
from secondary sources and field observations, structured over time and space. The latter is more
realistic and truthful. Prior discussions must be held with exporters, shipping lines, freight
forwarders, port authorities, concerned Commissioners of Customs/Excise etc., and their point of
view fully reflected in the report.

The traffic flows between Inland centers of production and ports need to be analysed with
reference to:

 Commodities
 Directional-split (Imports/Exports)
 Proportions of less-than-container load (LCL) and full-container-load (FCL)
 Forecast of future growth.
 Modes of transport available.
 Possible reduction in tone per kilometer or
 Box per kilometer costs.
 The facility has to be economically viable for the management and attractive to users, to
the railways for full train load movements; to other transport operators; seaports; shipping lines;
freight forwarders etc. must have certain minimum amount of traffic. The prospective
entrepreneurs are, therefore, strongly advised to study very carefully the viability of the project
from the TEU traffic availability point of view.

In the background of growing international trade, the infrastructure facility may have to
proceed the actual generation of demand. This is particularly important as such facilities have a
long gestation period for being fully operationalized. Though it is not proposed to lay down any
minimum TEU figures as part of the criteria for approval of ICDs/CFSs, following are suggested
indicative norms:-

For ICD – 6,000 TEUs per year (Two way)

For CFS – 1,000 TEUs per year (Two way)

LAND REQUIREMENTS

The minimum area requirement for a CFS would be One Hectare and for ICD Four
Hectare. However, a proposal could also be considered having less area on consideration of

technological up gradation and other peculiar features justifying such a deviation.

DESIGN AND LAY-OUT OF ICD/CFS

The design and layout should be the most modern state-of-art equipped with
mechanical/electrical facilities of international standards. Key to a good lay-out is the smooth
flow of containers, cargo and vehicles through the ICD/CFS. The design and layout should take
into account initial volume of business, estimated volume in 10 years’ horizon and the type of
facilities exporters would require. The initial lay out should be capable of adaptation to changing
circumstances. The design broadly should encompass features like (rail) siding, container yard,
gate house and security features, boundary wall (fencing), roads, pavements, office building and
public amenities. The track length and number of tracks should be adequate to handle rakes and
for stabling trains where relevant.
 The perimeter fencing and lighting must meet the standards required by Customs
authorities. The gate being the focal point of site security should be properly planned.

The administration building is the focal point of production and processing of all
documentation relating to handling of cargo and containers and its size will be determined by the
needs of potential occupants. Fixed provisions should be made for sanitation facilities and
possibly a food service facility.

A good communication system and computerization and EDI connectivity is essential.

Following Infrastructure should be available at the ICDs/CFSs

 Provision of standard pavement for heavy duty equipment for use in the operational
and stacking area of the terminal. In cases where only chassis operation is to be
performed, the pavement standard could be limited to that of a highway.
 Office building for ICD, Customs office and a separate block for user agencies
equipped with basic facilities.
 Warehousing facility, separately for exports and imports and long term storage of
bonded cargo.
 Gate Complex with separate entry and exit.
 Adequate parking space for vehicles awaiting entry to the terminal.
 Boundary wall according to standards specified by Customs.
 Internal roads for service and circulating areas.
 Electronic weighbridge.
 Computerized processing of documents with capability of being linked to EDI.

EQUIPPING THE ICD/CFS

The ICD/CFS would select most modern handling equipment for loading, unloading of
containers from rail flats, chassis, their stacking, movement, cargo handling, stuffing/destuffing,
etc. Following minimum equipment should be made available at ICDs/CFSs (Reach stacker may
not be mandatory:

 Dedicated equipment such as lift truck (front end loader, side loader or reach-stacker),
straddle carrier, rail mounted yard gantry crane, rubber tyred yard gantry crane, etc. of
reputed make and in good working condition (not more than 5 to 8 years old) and
 equipped with a telescopic spreader for handling the 20 ft and 40 ft boxes. The equipment
must have a minimum residual life of 8 years duly certified by the manufacturer or a
recognized inspection agency. An additional unit of equipment should be provided when
the throughput exceeds 8000 TEUs per annum or its multiples for lift truck based
operations.
 Terminals resorting to purely chassis-based operations do not require dedicated box
handling equipment. However, chassis-based operations should be restricted to CFSs
proposed to be set up near ports.
 Small capacity (2 to 5 tonnes) forklifts must be provided for cargo handling operations in
all terminals.

RAIL HEAD ICDs

The parties will be required to provide at their own cost all infrastructure facilities
including land, track, handling equipment for containers, maintenance of assets including track,
rolling stock, etc. as per extant railway rules applicable to private sidings. The cost of the railway
staff would be borne by the party as per the prevailing Government policy.

TARIFF

Tariff structure and costing should be worked out along with the feasibility study and
information provided with the application.

GENERAL

The main function of an ICD/CFS being receipt, dispatch and clearance of containerized
cargo, the need for an up-to-date inventory control and tracking system to locate containers /
cargo is paramount. Each functional unit of the facility (e.g. siding, container yard gate,
stuffing/de stuffing area, etc.) should have up-to-date and where possible on-line, real time
information about all the containers, etc., to meet the requirements of customers, administration,
railways etc. As far as possible, these operations shall be through electronic mode.

PROCEDURE FOR APPROVAL OF ICD/CFS AND ITS IMPLEMENTATION

1. Proposals for setting up ICD/CFS will be considered and cleared, on merits, by an Inter-
Ministerial Committee for ICDs/CFSs, which consists of officials of the Ministries of
Commerce, Finance (Department of Revenue), Railways and Shipping. Views of the State
Governments as necessary would be obtained.

2. Application 10 copies in enclosed form should be submitted to the Infrastructure Division in

the Ministry of Commerce, Udyog Bhavan, New Delhi. Application must be accompanied by 10
copies of feasibility reports mentioned in the guidelines.

3. The applicant should also send a separate copy of the application to the jurisdictional
Commissioner of Customs. The Commissioner of Customs will send his comments to the
Ministry of Commerce and the Central Board of Excise and Customs (CBEC) within 30 days. In
case, the project is planned in a port town, a copy of the proposal should also be sent to the
concerned Port Authority who would furnish their comments within 30 days to the Ministry of
Surface Transport and the Ministry of Commerce.

4. The applicants are also requested to familiarize with the statutory Custom requirements in
relation to Bonding, Transit Bond, Security Insurance and other necessary procedural
requirements and cost recovery charges payable before filing the application.

5. On receipt of the proposal, the Ministry of Commerce would take action to obtain the
comments from the jurisdictional Commissioner of Customs and other concerned agencies
within 30 days. Wherever necessary, a copy of the proposal should also be sent to Zonal Railway
Manager, under intimation to the Ministry of Railways One copy of the proposal would also be
made available to the IMC Members for advance action. The decision of the IMC would be taken
within six weeks of the receipt of the proposal under normal circumstances.

6. On acceptance of a proposal, a Letter of Intent will be issued to the applicant, which will
enable it to initiate steps to create infrastructure.

7. The applicant would be required to set up the infrastructure within one year from the date of
approval. The Ministry of Commerce may grant an extension of six months keeping in view the
justification given by the party. Thereafter, a report would be submitted to IMC to consider
extension for a further (final) period of six months. The IMC may consider extension or may
submitted to IMC to withdraw the approval granted.

8. The applicant, after receipt of approval, shall send quarterly progress report to Ministry of
Commerce. Three formats (given as annexure I to III) for sending the quarterly/ annual report
shall have to be submitted to Department of Commerce through electronic mode as well as
through hard copy.

9. After the applicant has put up the required infrastructure, met the security standards of the
jurisdictional Commissioner of Customs and provided a bond backed by bank guarantee to the
Customs, final clearance and Customs notification will be issued.

10. The approval will be subject to cancellation in the event of any abuse or violation of the
conditions of approval.

11. The working of the ICD/CFS will be open to review by the Inter Ministerial Committee.

1.4COMPANY PROFILE

ABOUT US
6D Shipping & Logistics was founded in 2002 as an owner/operator transport company started
to serve IT companies for media distribution have blossomed into a multi-tiered logistic
company meeting a wide range of freight management and distribution solution needs of SMEs
to MNCs. Over the years, the company grew together with the country. It is one of the well
grown logistics company providers in Chennai because of our high efficiency, commitment to
customers, and global reach. We deliver fully integrated logistics services and supply chain
solutions that are innovative and cost-effective. Our company is very effective in handling of
temperature control products, providing total logistic solution, for pharmaceuticals products,
clinical trail medicine, chemicals, or any such products that need to maintain required
temperature during domestic or international transportation.
THE ORGANIZATION TODAY
At 6D Shipping & Logistics, we aim to optimise every business opportunity in various fields by
delivering qualitative services. We firmly believe that "quality of a product or a service is not
 what a supplier puts in but it is what the customers get out of it and are willing to pay for". This
would prove to be a winning equation with respect to understanding of our customers and their
logistical support requirements. This is possible with the commitment, continuous motivation,
hard work and the promising nature of our entire team as it is never an individual but groups of
people, who turn any idea in to success and also a reality.

OUR METHODOLOGY
As a logistics company, we understand the value of time - we believe in allowing high flexibility
and tailoring our services to engage with the client's every point of requirement.
Business Practices and Business Relationships
6D Shipping & Logistics is committed to providing world-class services for its customers. We
believe that fair and trusting relationships with customers, suppliers and partners are essential to
deliver supply chain excellence.

Yashimarine personnel are requested to adhere to those principles, conduct business and
cooperate with customers and business partners in a manner that would not, in any way,
compromise those principles. Avoidance of unethical or compromising practice in relationships,
actions and communications is of the utmost importance.

Our Guiding Ethical Principles:

 Avoidance of unethical or compromising practice in relationships, actions and

communications
 Refrain from accepting money, gifts (other than nominal value), excessive hospitality,
loans or other special treatment from present or potential customers or suppliers
 Refrain from counter business agreements that restrain competition
OUR SERVICES

 Global Freight Management

 Logistics & Distribution Solution

 Warehouse Management

 Multi Modal Transportation

 Supply chain tracking system

 Pharmaceutical Logistics/ Transportation

 Temperature control transportation

Global Freight Management

We are able to offer highly competitive pricing for each step of freight management, be it export
or import, by sea, air or land - we become a single point of contact from the process of goods
collection, documentation and goods packaging for shipment, to custom issues clearance and
freight monitoring.

Logistics & Distribution Solution

We are able to extend logistics in tricky situations – such as micro distribution – where there are
many points of pick-ups, and a wide region for distribution. We can look into individual cases
where there is a step up process or extra cost incurrence that might be unnecessary. We can assist
to lower your cost and adjust time lags, resulting in a leaner logistic workflow.

Warehouse Management

6D Shipping & Logistics currently houses a permanent asset of a 2685 square feet warehouse at
Madhavaram Road. Our product range is being extended to include our comprehensive value-
added services to suit customers in all industry and retail sectors. These value-added services go
above and beyond conventional warehousing and enable you to focus on your key competencies.

We are able to offer an extensive list of warehouse support services:

- Records of warehousing history.

- Alert system via email upon shipment arrival or departure upon request.

- Customer support service for requests of arrival and departure information.

- Container stuffing and unstuffing.

Multi Modal Transportation

6D Shipping & Logistics, we have a variety of vans and trucks that cater to our clients’ needs.
Our transport team does not set timing limitations, and we seek to fulfill any urgent requirement
of transport services within the day.

It is a registered multimodal service provider with the Director General of Shipping and handles
the shipments by all modes of transportation globally.

The cargo market demands a global solution and network linking all four modes of transportation
i.e. (a) Air (b) Road (c) Rail & (d) Sea.

We provide a worldwide network linking airlines, roadways, railways and shipping lines in one
chain with a motive of better quality of service to customers with the most economical costing
and dependable schedule. This is with the object to provide most economical, smooth, reliable
and speedy carriage of shipments to various destinations on selected modes of transport which
must not only ensure hassle-free service but should render sizable savings in the freight expenses
of this customer.

Temperature control transportation

Storage, consolidation, repacking, documentation, labeling, invoicing, finished and spares

inventory management, distribution and service support, cross talking are all services provided
if required. 6D Shipping & Logistics also handles all logistics activities for spare parts including
repair and reverse logistics, replacement, re-export and scrapping.

Modern and well-equipped warehouses.

Adequate insured private warehousing space.
Safe storage of goods.
Control checks on entry & exit of goods.
Warehouse space at the ICD's for storage of goods carted direct at these centers.

Our services deliver:

1. Inventory integrity
2. Shorter lead times
3. Increased productivity
4. Greater responsiveness
 5. Fast and reliable start-ups
6. Flexibility to meet growing volumes and resultant peaks and valleys
7. Recruitment, training and motivation of workforces

BUSINESS TECHNOLOGY

We use a combination of externally and internally developed technological solutions that are
flexible, modular and scalable - to manage information within the supply chain. These can be
adapted to virtually meet any need, and are continually upgraded as necessary. Our approach is
to effectively and securely manage information while weighing the cost/value relationship for
efficiency and greatest value. We offer a strategy that is flexible, modular and at par with the
latest technology by leveraging on existing products and platforms by integrating functions for
network planning systems, transportation, warehouse freight consolidation, part sequencing,
kitting, sub-assembly and repacking.
CLIENTS
6D Shipping & Logistics handles operations for a diverse range of clients. We rank high in
customer satisfaction and customer retention because of our expertise and commitment to deliver
exceptional value and our ability to deliver performance based on measurable metrics.

FOOD & BEVERAGE

RETAIL

ENGINEERING

CHEMICAL
CONSUMER GOODS

LIQUOR

PHARMACEUTICAL
 CHAPTER 2

STATEMENT OF OBJECTIVES
PRIMARY OBJECTIVES
 To analyze the effectiveness of the CFS in Chennai

 To assist the CHA (Customs House Agent) to find the most effective CFS in Chennai
SECONDARY OBJECTIVES
 To study on the factors that makes the CHA to choose a CFS
 To analyze the infrastructure facility of the CFS in Chennai
 To study on the satisfaction level with the infrastructure facility provided by the C.F.S
 To study on customs formalities involved in clearance
 To gain knowledge on the services provided by the CFS
 To study the rate of EXIM trade happening in CFS in Chennai
 To get suggestions to improve the facility of C.F.S in Chennai in order to have smooth

EXIM (Export & Import) Clearance

 To Reduce the dwell time of cargo at the ports and improve the competitiveness .

CHAPTER 3
REVIEW OF LITERATURE

Raja simhan (2012) in his article states that, better infrastructure can boost productivity at
container freight stations. According to him, CFS operators are confident that business will
remain ‘bullish' for the next ten years. But better facilities hold the key to their viability.
Chennai has the maximum number of container freight stations (CFSs). There are 28 in operation
with three more to be set up soon. The CFSs are located in North Chennai, especially near the
industrial zone of Manali, serving both Chennai and Ennore ports.

But the moot questions are: Does Chennai really need so many CFSs and is there enough
business for them all? Or have the operators set up the facilities anticipating ‘mega' growth in
container traffic in and around Chennai in the next five years?
 Talking to a cross-section of people in the shipping industry revealed that the players feel
there will be enough business for the many CFSs. However, if the anticipated projects, including
the Rs 3,800-crore mega container terminal in Chennai port, are delayed, then the CFS operators
may be in big trouble.

The CFS operators are confident that business will remain ‘bullish' for the next ten years.
“We have take a big gamble by creating the facilities, keeping in mind the long-term container
growth at various ports,” said an official of a large CFS.

As per the business plans, the combined container traffic from Chennai, Ennore and Land
T's Katupalli ports will increase by about four times, to around 8 million TEUs from the present
1.6 million TEUs in the next five years. The annual handling capacity of Chennai port's mega
container terminal is expected to be 4 million TEUs; the Ennore container terminal will handle
2.4 million TEUs a year and the Katupalli port developed by Land T will have a capacity 1.8
million. The Katupalli project is almost ready (much of the equipment has been installed); and
the bidder for Ennore has been identified, while the Chennai terminal is still at the bidding stage.

Import/ export goods are stored in the CFS area till they are examined and cleared by the
Customs, thus reducing congestion in the actual port area.

Clearance of goods for delivery, warehousing, temporary admissions, re-export,

temporary storage for onward transit, outright export and transhipments take place from such
stations.

CFS CLEARANCE

Clearance of goods from a CFS is an important activity for the trade in respect of export/
import cargo as it is the final Customs contact point. In Chennai, the 28 freight stations handle
1.6 million TEUs. However, in Mumbai, only 18 box freight stations cater to traffic of over 3
million TEUs. In Chennai, it costs nearly Rs 25 crore to put up a CFS, which is typically put up
over 5-10 acres. In Mumbai, however, the CFSs are spread across 20-30 acres and are better
equipped than the stations in Chennai, said an industry source.
 Says V. Upendran, president, National Association of Container Freight Stations, the
growth or decline of a CFS depends purely on efficient container handling at the port. At the
Chennai port, container handling by private players improved by 20 per cent last year. This was
reflected in the higher number of containers handled.

HUGE POTENTIAL

The market size for container logistics in the country is estimated at Rs 10,000 crore, of
which business at inland container depots and container freight stations accounted for one-third.
“There is huge potential for growth,” said MrUpendran.

The present CFS capacity in Chennai is 11,500 ground-slots. This translates to storing
around 150,000 TEUs (in three-high stacks). The average monthly import is 65,640 TEUs, with
yard utilization being 43 per cent, said an official of a leading CFS in Manali.

Of the 28 CFSs, the top 12, including Concor, Sanco, AllCargo and German Express, have
ground-slots to store 9,000 TEUs. These 12 stations garner nearly 85 per cent of the imports. The
monthly average of imports handled is 46,576 TEUs, leading to 44 per cent utilization. The ideal
capacity utilization is 70-75 per cent for efficient operations. The top 12 CFSs will try to garner
at least another 30 per cent of the market, putting pressure on the smaller players.

Traffic growth is expected to be sluggish. The emergence of Krishnapatnam port should

also be taken into account, though with organic growth and higher containerisation, the demand
situation could improve.

INFRASTRUCTURE

The Chennai shipping trade has borne the brunt of bad infrastructure for the last decade.
Despite this, growth in container handling was around 20 per cent. The success of a CFS will
depend not only on better port performance but also on good road infrastructure. This will speed
up the movement of vehicles between the CFS and the port, said MrUpendran.

Shortage of Customs' officers to be posted at the CFSs continues to be a major concern

for the industry. Often, one officer needs to shuttle between the various CFSs. This delays the
clearance of cargo. “If such delays are avoided, productivity at each CFS can improve by nearly
10 per cent,” said a freight station official.

According to BrijeshGhelan,(2010)

Container Freight Station is utilized as inter modal freight service and therefore are
important things found in something referred to as containerization. They're also generally
known as inter modal transportation products and therefore are packed and covered undamaged
on to railway vehicles, airplanes and pickup trucks.

The initial information of these resulted in large enhancements in interface dealing with
effectiveness, that experienced the result associated with decreasing freight charges, as well as
decreasing common charges that allows increase the circulation of business. Numerous produced
items people consume, may have invested a while in Container Freight Station.

The objective to created vessels, that were only available in 1951 in Denmark. They've
revolutionized freight shipping, now close to 90% of low bulk freight worldwide is actually
transferred through freight containers piledon ships. Freight Station tend to be mainly made of
steel, and also have a good starting generally at a single end. Other styles of freight containers
might be constructed from wooden with regard to various storage and transportation functions.

However several people from the globe no more travel their own approach through port,
there isn't any question how the energy of the oceans have not reduced through the years. Right
now, on the other hand, there is certainly much less traveler and much more container transport.
This really is especially correct in between main trading companions. Shipping from USA to by
means of sea it's possible to begin to see the outlines of container cruises trimming away on the
horizon, transferring items from end of the globe to a different.

That will distinct cruises could be a small deceitful. Not every of these container ships are
manufactured the same. For this reason whenever shipping from USA to India by ocean, you'll
need a high quality Container Freight Station that's correctly certified and skilled at dealing with
different types of items. Through little pallets to move on as well as rotate off support for design
products along with other vehicles, you would like flexibility and high quality control.
 One component of flexibility to think about whenever shipping from USA to India by
ocean may be the capability to deliver both complete container loads and under container loads.
Authorities of shipping enables you to proper size your deliveries to retain the specific loads
preferred. This could allow it to be simpler to be more comfortable with the freight associate for
little however useful loads, for example consumer electronics or jewelry.

An additional component of flexibility to think about is actually dangerous supplies

managing. Numerous commercial chemical substances can not be delivered through
conventional because of their sensitive character or even their own unique dealing with
specifications. Luckily, whenever you make use of a top quality Container Freight Station, you
could have the actual support you should much more dangerous supplies in between areas in
protection and conformity through the shipping procedure.

Dealing with dangerous items is simply one of these associated with exactly how
flexibility supported along with high quality shipping from USA to India by sea a simple option
for the company. Careful management of the storage containers, irrespective of their own
material, enables you to deliver with full confidence. Because of this, look severely on the
distinct container delivers trimming away within the horizon and become sure you've selected to
utilize simply the highest quality agency to satisfy your requirements. The ability of the ocean in
order to assist like a transit freeway is actually undiminished, however only when you might be
joining up having a high quality container freight service.

3.1 Facts about Container Freight Station in Chennai

There are thirty (30) Container Freight Station (CFS) in Chennai. The list of CFS IN Chennai is
as follow

TABLE 3.1

NAME OF THE CFS

1.ALL CARGO
2.BALMER LAWRIE
3.COCOR
4.C.W.C(VIRUGAMBAKKAM)
5.C.W.C(MADHAVARAM)
6.C.W.C(ROYAPURAM)
7.C.W.C(THIRUVOTTRIYUR)
8.CONTINENTAL WAREHOUSING
CORPORATION
9.CHANDRA CFS
10.D.R.LOGISTICS
11.ENNORE CARGO CONTAINER TERMINAL
12.GERMAN EXPRESS
13.GATEWAY
14.INDIAN CORPORATE BUSINESS CENTRE
15.KAILASH CFS
16.A.S.SHIPPING
17.SANCO TRANS
18.SATTVA CFS
19.SATTVA LOGISTICS
20.SICAL CWT
21.VISTRUTHA CFS
22.TRIWAY CFS
23.MAERSK CFS
24.CHENNAI CONTAINER TERMINAL(C.C.T.L)
25.THIRUVANI
26.HAPAG LLOYD
27.GLOVIS
28.ENNORE CARGO CONTAINER TERMIMAL
29.BINNY CFS
30.P.S.T.S CFS

 There are thirty Container Freight Station in Chennai, out of those twenty seven deals
with both Exports and Imports and three deals with Exports only.

 There are nine (CFS) which has been started recently in 5 years. There is (CFS) which is
existing for more than twenty years in EXIM business.

 The handling of TEU’s in each Container Freight Station, eight CFS handle more than
3000 TEU’s in a month. More than 7000 TEU’s and 5000 TEU’s are handled equally by 7
Container Freight Station’s.

The top 3 CFS which handles maximum TEU are as follows (COURTESY TAMIL
CHAMBER OF COMMERCE: TCC DIGEST EXIM AWARDS)
Exports
1. C.W.C (Madhavaram) (85,656 TEUs Export cargo)
2. A.S Shipping Agencies Pvt ltd (29,806 TEUs Export cargo)
3. Container Corporation of India (CONCOR)
Imports
1. Sicaldistrparks Ltd (66,820 Imports –TEUs)

2. Sanco Trans Ltd

3. Sattva CFS Logistics (46,067 Imports –TEUs)

Journals and Articles:

1. Title: A STUDY ON THE DIFFERENTIATION IN SERVICE AND PERFORMANCE BY
THE FREIGHT FORWARDERS IN LOGISTIC OPERATIONS.
Journal: IJPSS Volume 2, Issue 3 ISSN: 2249-5894
Author: Dr. J. PAUL SUNDAR KIRUBAKARAN
Website Link: https://www.ijmra.us/project%20doc/IJPSS_MARCH2012/IJMRA-PSS832.pdf
India‟s maritime trade comprises of export-import trade in various bulk commodities like crude
oil and other petroleum products, iron ore and coal, besides general-purpose cargo. The
economic liberation gives way for an upheaval of handling value-added goods through
containers and transporting cargo to several Indian ports. This container transportation has
redefined these services also it has emerged as very sophisticated logistic services. Freight
forwarding agents specialize in the arranging of shipping and insurance, and many of them today
arrange land, sea and air transportation for goods. They take a good deal of work off the
exporters‟ shoulders. They follow all the formalities of documentation for customs clearance.
They also look after the warehousing and carting of cargoes before shipment of export
consignments and after discharge of import cargoes, by the sea carriers
The analysis made is Multiple Regression in this study. This helps to find out the correlation
between the dependent variable and independent variables. The relationship between the Level of
satisfaction perceived by the freight forwarders on logistic operations Nine independent variables
were selected and it was found that out off Nine variable Six factors were closely associated and
Three factors were not significant. The factor like nature of organization, annual income, wealth
position, source of information about exporters, logistic operational countries and mode of
operations are positively associated, this shows that the volume of business can be operated
through the freight forwarders only when they have perceived the maximum level of satisfaction.
The multiple regression analysis reveals that the satisfaction perceived by the Freight Forwarders
on logistic operations is positively associated with the factors like nature of organization, annual
income, wealth position, source of information about exporters, and the logistic operational
countries of the respondents. It will generate more business for the Freight Forwarders when they
implement the Supply Chain Management Concept, is practiced with the highest level of
satisfaction.
CONCLUSION:
The freight forwarders prove the great poet Mr. Bharathiyar‟s saying of “Thirai Kadal Odiyum
Thiraviyam theadu” through efficient logistic operations to various countries with limited
infrastructural facilities particularly in the study area. Though various problems are studied and
highlighted in this research, the researcher specially notes that the freight forwarders in Chennai
and Tuticorin are performing in an excellent manner. They are also very much enthusiastic and
most dynamic personalities and have the willpower and courage to dominate the Germans
container vessels operations. Further, it is observed that, a very meager percentage of freight
forwarders are applying supply chain management concept while a good majority of freight
forwarders are not at all following the concept of supply chain management because most of
them following sub agency system. In order to utilize the supply chain management concept at
the optimal level a proper initiation should be made to encourage the freight forwarders this can
be very easily achieved by the freight forwarders association, CII and government of India.
Adequate training should be given to the freight forwarders on supply chain management
concepts and also to avert the common problems faced by the freight forwarders.

2. Title: Container Freight Stations, Inland Container Depots different

Article: Standard Business

Website Link: http://www.business-standard.com/article/economy-policy/container-freight-
stations-inland-container-depots-different-109061500096_1.html
For most exporters, importers, Customs house and shipping line agents, and even Customs
officers, there is no difference between Container Freight Stations (CFS) and Inland Container
Depots (ICD). In both the places, the imported goods or export goods are ordinarily kept before
clearance by the Customs and where filing of Customs manifests, bills of entry, shipping bills
and other declarations, assessment and all the activities related to clearance of goods for home
consumption, warehousing, temporary admissions, re-export, temporary storage for onward
transit and outright export, transshipment, etc, take place. So, CFS and ICD mean the same thing
for many. However, they do not mean the same facility, says the Central Board of Excise and
Customs (CBEC).

A recent CBEC circular clarifies that CFS is merely an appendage to a parent Customs station at
a port, airport, land Customs station (LCS) or ICD whereas an ICD is a Customs station in its
own right having independent existence on a par with any Customs station at a port, airport or
LCS. A CFS is an extension of a port/airport/LCS/ICD customs station, set up with the main
objective of decongesting the ports, where only a part of the customs process mainly the
examination of goods is normally carried out by Customs.

At CFS, goods are stuffed into containers or de-stuffed therefrom and aggregation/segregation
also takes place at such places. Custom’s function relating to processing of manifest,
import/export declarations that are filed by the carrier/importer or exporter and assessment of bill
of entry/shipping bill are performed in the Custom House/Custom Office that exercises
jurisdiction over the parent port/airport/ICD/LCS to which the said CFS is attached. In the case
of customs stations where automated processing of documents has been introduced, terminals
have been provided at such CFSs for recording the result of examination, etc. In some CFSs,
extension of service centers have also been made available for filing documents, amendments
etc. However, the assessment of the documents is carried out centrally.

On the other hand, an ICD would have an automated system of its own with a separate station
code [such as INTKD 6, INSNF6, etc] allotted by the Directorate General of Systems and with
the inbuilt capacity to not only enter examination reports but also to enable assessment of
documents, processing of manifest, amendments, etc, says the CBEC. So, a Commissioner can
approve a standalone ICD but not approve a standalone CFS.
So, for an importer, exporter, CHA or shipping line, how does it matter whether a place is
designated as a CFS or ICD?

Essentially, movement of goods from a port, airport or LCS to an ICD shall be in the nature of
movement from one custom station to another custom station and will be covered by Goods
Imported (Condition of Transshipment) Regulations, 1995. In contrast, movement of goods from
a customs station at port/airport/ LCS/ICD to a CFS would be akin to local movement from a
custom area of a customs station to another custom area of the same station and such movement
is covered by local procedure evolved by the Commissioner of Customs and covered by bonds,
bank guarantee, etc.

With this clarification, there ought to be no confusion in compliance with procedures prescribed
for import/export of goods or compliance with the provisions of the Customs Act, Rules or
Regulations, hopes the CBEC.

3. Title: A STUDY ON ROLE OF PORTS, CONTAINER FREIGHT STATIONS AND

INLAND CONTAINER DEPOT IN LOGISTICAL DEVELOPMENT
Journal: Tactful Management Research Journal
Author: Astt. Prof. Girish V Upadhye
Website Link: http://tmgt.lsrj.in/SeminarPdf/234.pdf
Logistics management is that part of the supply chain management process that plan,
implements, and controls the efficient, effective forward and reverse flow and storage of goods,
services and related information between the point of origin and the point of consumption in
order to meet customer’s requirements. With rising consumer demand and the resulting growth in
global trade, the role of infrastructure support in terms of rails, roads, ports & warehouses hold
the key to the success of the economy. Ports have been natural sites for transhipment in order to
transfer goods from one mode of transport to another. They have historically provided the link
between maritime and inland transport, and the interface between the sea and rivers and roads
and railways. At present, ports play an important role in the management and co-ordination of
materials and information flows, as the transport is an integral part of the entire supply chain. In
a wide sense, ports are complex entities supporting to the procurement of raw materials, the
manufacturing and the distribution of finished goods. They are the potential members of different
supply chains. CFS is a place where containers are stuffed, de-stuffed and aggregation/
segregation of export/import cargo take place. With the growing volume of international trade,
the need for expeditious clearance of goods at the port within the minimum possible time has
been gaining importance. This is more so when the ports are facing congestion at their premises.
A CFS is an extended arm of Port/ ICD/ Air cargo Complex, where import/ export goods are kept
till completion of their examination and clearance. The present paper deals with changing
logistical infrastructure and role of ports and container freight stations and ICDs in the logistical
development of our country. It brings into light the developments taking place at ports and a key
role of CFS in developing it.
THE ROLE OFCONTAINER FREIGHTSTATIONS (CFS):-
CFS is a place where containers are stuffed, de-stuffed and aggregation/ segregation of
export/import cargo takes place. With the growing volume of international trade, the need for
expeditious clearance of goods at the port within the minimum possible time has been gaining
importance. This is more so when the ports are facing congestion at their premises. A CFS is an
extended arm of Port/ ICD/ Aircargo Complex, where import/ export goods are kept till
completion of their examination and clearance.
PRESENT PROCEDURE OFCLEARANCE OFGOODS ATCFS:-
The Main function of CFS is receipt, dispatch and clearance of Containerized Cargo, up-to-date
inventory control and tracking system to locate containers/cargo. The goods received at ports are
brought to CFS and stacked in CFS after verification of the seal by Customs Officers. In respect
of import consignment, the Steamer Agents/liners/ Importers desiring to take the consignment to
CFS, file Import General Manifests in the port. After obtaining the permission from the AC/DC,
the Container moves to CFS under Customs escort or under bond and bank guarantee. The CFS
allow de-stuffing of the goods. The CHA/ importer files the Bill of Entry at Customs House and
then Customs formalities of assessment, examination and payment of duty are completed.
Thereafter, Customs gives “Out of Charge” and the Custodian releases the goods from CFS by
issuing a Gate-Pass. In respect of exports, the goods are brought directly to CFS under a
Shipping Bill. The export cargo in Less than Container Load (LCL)/ Full container Load (FCL)
is received by the Custodian of CFS for safe custody. After stuffing of the goods, Container/
Customs Bonded Truck (CBT) is sealed by the Custom Officer and the same is removed from
CFS for export through the desired Port.
All the above facts brought into light in this paper will give a clear idea how the role of ports,
CFS and ICD is important in the logistical development not only in India but all over the world.
In near future, there is a huge scope for logistical development since the process of globalisation
of trade is in progress. In case of India, there is more scope for developing new ports as present
ports are congesting and the economy is developing with fast rate resulting into growth of
foreign trade.
4. Title: An Analysis on Performance of Container Freight Station in the Port of Mombasa in
Kenya
Journal: An Analysis on Performance of Container Freight Station in the Port of Mombasa in
Kenya
Author: Weldon Korir, Kenya;
Website Link: http://www.journalijar.com/uploads/2014-01-01_010405_457.pdf
This study sought to examine the performances of Container Freight Station (CFS) in the port of
Mombasa in Kenya. Although the concept is new in Kenya, there study will find out and analyze
the effects of container freight station in decongesting the port of Mombasa and how CFS can
make the Port of Mombasa become more efficient and effective as Port of choice for East and
Central Africa region. The study used primary and secondary data analysis on data collected
from the existing documents and interviews conducted within the organization various
operational CFS and C& F agents operating within Mombasa. The finding shows that Mombasa
port is currently among the fast growing ports in the world in terms of container handling trends.
These has lead to congestion every now and then for the last ten years. The constraints has been a
major hurdle in port operation as cargo imported especially cars and containers which have
surpassed yard holding capacity against a backdrop of poor cargo off-take to their final
destination.
The above mentioned recommendation are a critical look at roles and responsibilities play by
various parties involved in the Cargo clearance in the port of Mombasa and notwithstanding the
original report which form the basis of this study. This research is consistent with earlier research
by Kenya Association of manufacturers (KAM) and East Africa Tea Traders Association on the
need for Kenya Maritime Authority (KMA) to come up and strongly play their role on
supervisory and guidance to various stakeholders dealing with cargo handling and deliveries
among others.
The container traffic increased from 16.29 million tonnes in 2007/8 to 21.34 million tonnes in
2011/12, an average annual growth of 7.0 per cent, these was a positive development in terms of
business and national economy and this call for KPA to re-strategies on its core business of cargo
handling as enshrine in the KPA Act and leave the storage of cargo to other stakeholders. This is
a global trend whereby multi-modal business aims at efficiencies to traders within a reasonable
cost. Some of the challenges affecting the port of Mombasa as a result of increase in through put
over the last 10 years especially cargo handling capacity and yard space has been well taken care
of by the current trend of equipment purchase policy and utilization of Container Freight Station
yard instead of port yard. The encouragement of private sector participation has led to positive
infrastructural development and operations of 10 Container Freight Station within Mombasa
areas which are currently helping the port of Mombasa in cargo handling and storage facilities.
The positive implication has been the salvage of KPA from the possibility of Vessel Delay
Surcharge and the efficiency brought in the ability to create more space for incoming cargo and
faster deliveries from the port of Mombasa terminal yard and Motor vehicle yards. For all the
current 10 operational CFSs in Mombasa, none of them are railed based terminal but road
dependant for inflow of cargo. This has some negative effect in terms of traffic congestion,
parking space and economies of scale in cargo handling. To some extend according to this study,
this is acceptable considering the fact that Container Freight Station is a new concept and hence
was not put in consideration during road design, city planning among other things. The concept
is based on business strategies and efficiency in cargo handling & deliveries, there is less
bureaucracy which affects all state run institution. The container yard is fully dependant on what
the business owners’ intent to handle over a given period of time and the type of cargo they plan
to handle.

5. Title: DETERMINANTS OF CONSUMER CHOICE IN THE UPTAKE OF CONTAINER

FREIGHT STATION (CFS) PRODUCTS IN KENYA: A CASE STUDY OF SELECTED
CONTAINER FREIGHT STATIONS IN MOMBASA
Journal: International Journal of Arts and Entrepreneurship , Vol.1, Issue 5, 2013
Author: Winfred Kajuju
Website Link:
Maritime freight volumes fluctuate with changes in consumer demand and global economies. In
response to increasing container volumes, congestion and capacity constraints; ports have
embarked on implementation of inland container depots (ICDs) as capacity enhancement
strategy. Determination of optimal pricing strategies and demand intensification has become the
biggest challenges for privately owned Container Freight Stations. This paper analyzes the
greater influences of consumer demand in this industry marred by intense competition and
increased regulation from industry stakeholders. The research evaluates factors which determine
competitiveness of each CFs with a view to understanding the drivers to consumer choice. It also
reviews the nature, characteristics and operational modalities for driving consumer demand and
highlight strategies that will help improve operational efficiency, drive demand and increase
company profit margins. The study aims at establishing the relationship between choice of a
particular CFS to its physical location, the effects of marketing strategies used by various firms,
the regulatory framework affecting the operations of CFSs and the products characteristics. A
descriptive research design approach was used to describe phenomena under study. Data analysis
was done through S.P.S.S program through approaches such as means, modes and correlation
techniques to show how each independent variable affect the dependent variable. The findings
are presented through percentages, pie charts, tables and graphs.
Problem Statement
Container Freight stations have been heralded as the next big economic promoter for this country
besides the port in the trade and maritime industry. In a growth industry which is characterized
by cut throat competition and alternative service providers, consumers have the freedom to
choose from among the available options.
In Kenya the growth of the CFS industry has largely been influenced by the global economic
boom leading to increase in international trade and consequently this has increased competition
for established container terminals, which have naturally experienced reduced customer loyalty
(Lobo & Jain, 2002). This growth has also seen competition for trans-shipment cargo on the
increase and the focus has now shifted to the quality of services offered by container terminals to
their customers (Lobo & Jain, 2002) which determines the overall demand for their individual
services offered. The need to understand determinants of consumer choice is very important in
order to provide the right products and level of quality services to the consumers. Container
Freight Stations are faced with a challenge of developing tailor made solutions to their clients
and to also thoroughly understand their market segments.
Research Objectives
This study seeks to accomplish four major specific objectives:
1. To analyze the relationship between products characteristics and consumer choice in CFS
products uptake.
2. To evaluate how marketing strategies determine consumer choice of CFSs products uptake.
3. To determine how the location of CFSs affects consumer choice of CFS products uptake.
4. To evaluate how regulatory framework governing the CFS’ operations in Kenya affects
consumer choice of CFS products.
Recommendations
Through the research carried out, the researcher was able to indentify key issues for
recommendation towards achieving the purpose of the study and help Container Freight Stations
realize greater revenues. Despite there being in existence a positive relationship between the
products characteristics and consumer choice, firms ought to identify their customer needs and
package their products and service so as deliver market offerings which are both competitive and
unique in order to achieve greater revenues. Marketing managers ought to undertake intensive
qualitative research on how to implement their pricing strategies in order to avoid industrial price
wars but then remain competitive and profitable. The need to also research on effective
marketing strategies can therefore not be over emphasized so as justify increased investments in
marketing in the realization of revenues and avoid wastages and loss arising as a result of no
improvement in revenue trends. Seamless service delivery is key towards achieving and
influencing consumer choice of CFS. This is because through this study, it has been established
that the level of service is positively correlated to consumer choice. It is also important to note
that quality of services enhance customer satisfaction which distinguishes between the perceived
and the experienced level of quality. Operational efficiency would enhance good service from
point of contact (entry) of a client to their exit through the various transaction chains in the
company. As noted from the literature review of this study, the role of innovation has great
impact on choice through increasing faster transaction processing. CFSs need to invest in
systems that will increase efficiency for their customers such as online tracking of consignments/
cargo and the ability to pay charges in faster and convenient ways such as through E-payments.
CHAPTER 4
RESEARCH METHODOLOGY

The system of collecting data for research projects is known as research methodology.
The data may be collected for either theoretical or practical research for example management
research may be strategically conceptualized along with operational planning methods and
change management.

Some important factors in research methodology include validity of research data, Ethics
and the reliability of measures most of your work is finished by the time you finish the analysis
of your data.

Formulating of research questions along with sampling weather probable or non-probable

is followed by measurement that includes surveys and scaling. This is followed by research
design, which may be either experimental or quasi-experimental. The last two stages are data
analysis and finally writing the research paper, which is organized carefully into graphs and
tables so that only important relevant data is shown.

Types of Research Methods

 Qualitative
 Quantitative
 Mixed
 Critical and action oriented

STEPS IN RESEARCH PROCESS

The preparation of a successful dissertation involves conducting effective research, analyzing

data and results presentation all which require a high level of statistical expertise.

 Framing your Research Methodology

 Study design
 Sample size calculation and justification
 Development of questionnaire
 Statistical techniques
4.1 RESEARCH DESIGN
“A research design is the arrangement of condition for collection and analysis of data in a
manner that aims to combine relevance to the research purpose with economy in procedure”. In
fact, the research design is the conceptual structure within which research is conducted; it
constitutes the blueprint for the collection, measurement and analysis of data.
4.2 SAMPLE SIZE

As there are more than 500 CHA’s in Chennai, I have shortlisted my sample size to 40

4.3 SAMPLING METHOD

Convenience sampling method was adopted for the survey.

4.4 PERIOD OF THE STUDY

4.5 METHODS OF DATA COLLECTION

Different types of data collection method I have chosen for project, namely Survey,
Primary data collection, Secondary data collection and Personal Interview.

a) Survey Method: The survey research is a systematic gathering of data from the
respondents through questionnaire the main purpose of the survey is to facilitate in
understanding (or) enable prediction of some aspects of behavior of the population being
survey.

b) Primary Data Collection Method: Primary data was collected from the respondents by
using a structured questionnaire.

c) Secondary Data Collection Method: Secondary Data was collected from journals,
books and magazine.

d) Personal Interview: Personal Interview is conducted to the respondents in person by

circulating the finalized questionnaire and collect relevant information.
4.6 QUESTIONNAIRE DESIGN
No survey can achieve success without a well-designed questionnaire. Unfortunately,
questionnaire design has no theoretical base to guide the marketing researcher in developing a
flawless questionnaire. All the researcher has to guide him/her is a lengthy list of do's and don'ts
born out of the experience of other researchers past and present. Hence, questionnaire design is
more of an art than a science.

Types of Questions

All researchers must make two basic decisions when designing a survey--they must
decide: 1) whether they are going to employ an oral, written, or electronic method, and 2)
whether they are going to choose questions that are open or close-ended.

Closed-Ended Questions: Closed-ended questions limit respondents' answers to the survey. The
participants are allowed to choose from either a pre-existing set of dichotomous answers, such as
yes/no, true/false, or multiple choice with an option for "other" to be filled in, or ranking scale
response options. The most common of the ranking scale questions is called the Likert scale
question. This kind of question asks the respondents to look at a statement (such as "The most
important education issue facing our nation in the year 2000 is that all third graders should be
able to read") and then "rank" this statement according to the degree to which they agree ("I
strongly agree, I somewhat agree, I have no opinion, I somewhat disagree, I strongly disagree").

Open-Ended Questions: Open-ended questions do not give respondents answers to choose

from, but rather are phrased so that the respondents are encouraged to explain their answers and
reactions to the question with a sentence, a paragraph, or even a page or more, depending on the
survey. If you wish to find information on the same topic as asked above (the future of
elementary education), but would like to find out what respondents would come up with on their
own, you might choose an open-ended question like "What do you think is the most important
educational issue facing our nation in the year 2000?" rather than the Likert scale question. Or, if
you would like to focus on reading as the topic, but would still not like to limit the participants'
responses, you might pose the question this way: "Do you think that the most important issue
facing education is literacy? Explain your answer below."

Yes–no Question: Formally known as a polar question, is a question whose expected answer is
either "yes" or "no".
Scaled Questions: Using numbers assigned to identify categories, rank order, or equal intervals,
a scaled question provides a set of response options that allows you to measure attitudes,
opinions, personalities, and descriptions of people’s lives and environments.

4.7 STATISTICAL ANALYSIS USED

WEIGHTED AVERAGE method was used in analyzing the sample. The weighted
mean is similar to an arithmetic mean (the most common type of average), where instead of each
of the data points contributing equally to the final average, some data points contribute more than
others. The notion of weighted mean plays a role in descriptive statistics and also occurs in a
more general form in several other areas of mathematics.
PERCENTAGE ANALYSIS This is the statistical tool which is used for analysis
purpose. For multiple-choice question this analysis is most appropriate one. The percentage
analysis is the analysis of ratio of a current value to based value either the result multiplied by
100. The main objective of the percentage analysis is comparison of data for the analysis.
No of respondents
Percentage analysis = --------------------------------- X 100
Total respondents

4.8 SCOPE OF THE STUDY

 This study helps me to learn the Container Freight Station activities.

 This study helps me to know the real time happenings in Container Freight Station.

 It helped me to understand International Trade (EXIM) procedures.

 This study also helped me to interact with many C.H.As and analyze their challenges
faced by them.
 This study also helped me understand the Custom procedures and formalities in EXIM
trade.

 This study may enhance performance of CFS in Chennai

4.9 LIMITATIONS OF THE STUDY

 As this is an individual project am not cover many respondents (C.H.As),I have done
with only small sample size with just 40 respondents, so this is just a tentative result.

 In some C.H.A office I was not responded properly.

 Lack of information like total TEUs capacity in Chennai CFSs etc makes me dis-
satisfied as the Government feels confidential.

CHAPTER 5
DATA ANALYSIS AND INTERPRETATION