International Cooperation on e-Logistics in APEC

15-16 Jun, 2004

Chang Ryong, Kim / Directore-Business Policy Division

Ministry of Commerce, Industry and EnergyRepublic of Korea

CONTENTS

Background of e-LogisticsNew Subject for Discussion in APECLet us Reach an AgreementPain Points facing usWhat’s Going on in KoreaApplications with KILCExpansion of KILC Services :Model for APECAPEC centric Visibility BeltOne Example under APEC e-LogisticsProcedures for follow-up

3

Background of e-Logistics Logistics can be referred to economy in creation and movement of value.

Orig

in

Destin

ati

on

Manufacture Consume

Movement of cargo

Movement of information

Movement of money

Movement of people

Value CreationValue Creation Value SatisfactionValue Satisfaction

Development and Growth of Global Economy

Separation of trade & logistics

Paperless trade

Paperless logistics

Integration of trade & logistics

Advent of e-Logistics

4

New Subject for Discussion in APEC

Protection of cargo &

ship

Protection of cargo &

ship

For APEC prosperity, various efforts have been made until now.

Strengthening of security

Strengthening of security Improving the

transportation system

Improving the transportation

system

Promoting the e-commerce

Promoting the e-commerce

Realizing paperless

trade

Realizing paperless

trade

Developing communication

system

Developing communication

systemSecuring

cyber security

Securing cyber

security

Securing cyber

security

Securing cyber

security

What do you say to adding “this” to our efforts?

e-Logistics

paradigm shift

Let us reach an agreement

PlanningExecution

Report

rating & routing

contract

forecasting

allocation

compliance

booking

documentVisibility

finance

Optimization

PlanningExecution

Evaluation

rating & routing

contract

forecasting

allocation

compliance

booking

documentVisibility

finance

schedule

Analysis

Optimization

Report

3 tiered seamless logistics service concept and model Pre-planning step emphasized for minimizing errors and irregularities of logistics Data originated in customers shared and reused to the last analysis step Visibility supplying cargo status data functioning as a backbone

First of all, we need to talk about “what e-Logistics is all about”

6

Pain Points facing Us

Remedy for status quo thru diagnosis to be visibility based on e-Logistics

Legacy ForwarderExporter

Inland

Warehouse

-Where is my cargo? - Will it arrive on time? -Will it arrive in time? - Will will it be delayed, how long?-What happened to it? - Do I have to change delivery time, or transfer transportation mode?

-Booking to forwarder& shipping lines byphone, fax, mail not bydata or EDI

-Logistics data(Visibility) not supplied by data

-Exporter contacts forwarder, shipping line, customs broker, warehouse respectively for visibility data

physical cargo tracking zonephysical cargo tracking zone

-Supply visibility data with different way and format

-Tracking data provided after delay or irregularities of cargoand sending them in different (phone/fax/mail) and not in consistent way, turning out not to be so useful

Railroad

Airport

Seaport

Landport Importer

-Traditionally reluctant to give cargo data to customers

-Not in a position to create data

-Not provided with proper and timely data

7

What’s going on in Korea

Ind

us

try

MP

Ind

us

try

MP

Ind

us

try

MP

Ind

us

try

MP

Ind

us

try

MP

Korea Integrated Logistics Consortium(KILC) Platform

Single connection, receiving service request, providing visibility data

Single access, requesting logistics service such as booking, visibility

Public e-Marketplace specialized in e-Logistics Commonly used by more than 30 e-Marketplaces Funded and developed by government and private logistics industries Supporting trading companies in accessing logistics services and providers Functioning as on-line information gateway for global logistics

KILC (Korea Integrated Logistics Consortium) representing e-Logistics

car

textil

e

oil

tool

s

ele

ctro

nic

s

8

Getting started with global visibility service in e-Logistics

End to End, Real & Near Time

Global VisibilitySupplier/Factory

Export clearanceImport clearance

Goods Issues

Integrated & Centralized

Connection

DC/Buyer

Pick Up

Build up

ArrivalDepartureForwarder

Terminal

Airlines

Carrier

Break down

Terminal

Forwarder

Trucker

Delivery

Goods Receipt

Trucker

P/OIssue

P/O Accept

Goods Issue

Pick Up Shipment B/L

Issues Transport Transfer

Import Arrival,

Customs- Release

Inland Cartage

Delivery Invoice

Account Payable

Goods Receipt

Shipper Consignee

Intelligent and pro active track & trace platform; the backbone of KILC Data connection by uploading from legacy, inputting, connecting with abroad Booking from customers to logistics service providers possible by on-line Pre-alert, event management, inventory(in motion & at rest)control provided

9

Basic Functionalities served by global visibility

Booking - From importer/ exporter to forwarder - Automatic upload of booking data from application, or manual input

Adaptor/Interface - data upload from legacy - versatile adaptor - data input - system connection

Inventory control - at rest(stock) - in motion - simulating inventory status

Cargo tracking - by container number - by Bill of lading - by P/O - by item number

Pre-alert - Sending pre-alert to touch points involved in each import/export activity by mail, data, mobile

Pipeline - Easily building up pipeline from door to destination composed of various touch points

Event management by monitoring - Notifying, fixing, and managing irregular cargo flows from origin to destination

connectivity -Connection with various VANs, systems, e-Marketplace in domestic or abroad

Booking by data

Event management by monitoring

Global connectivity

Global Visibility Backbone

e-Logistics(B2B) e-Logisframe(B2G)

Domestic Logistics International Logistics

Internet WEB ASP Connection

Logistics Service Providers

Importer

Exporter

Glo

bal e

-M

Ps

GTNexusGTNexus

INTTRAINTTRA

CargoSmartCargoSmart

TraxonTraxon

Existing EDI based VANs Legacy System of Enterprise

More than 30 domestic B2B e-Marketplaces

Easy Access

ReasonablePrice

WiderConnection

e-Logistics Single Window

End to end & seamless gateway for importer/exporter & logistics service provider International & domestic logistics service enabler Easily & cheaply accessed and globally connected marketplace

KILC functioning as a Single Window for e-Logistics

11

VISIBILITY in KILCVISIBILITY in KILC

ATHENA

[HP GLOBAL] [HP KOREA]

[Customs Broker] [Bonded Warehouse][Inland Transportation]

Import Clearance Transportation Status

One Example of Visibility now in service : data connection

SCM:Production, InventorySCM:Delivery, Shipment

[HP Singapore]

Commercial Invoice

Commercial Invoice

Vis

ibility

M

on

itor

Vis

ibility

M

on

itor

HP(Headquarter, Korea), logistics service providers connected with KILC Data uploaded and shared with trading partners Real time cargo status data created and supplied for customers Cargo delay, on time, in time detected on the WEB Efforts, time and cost for cargo tracking obviated or minimized

Cargo in & out of W/H

Applications with KILC

upload upload

12

Visibility Connection with Overseas e-Marketplace KILC connected with GTNexus, an e-Marketplace for container liner shipping KILC and GTNexus exchanging booking and visibility data with each other Korea’s customers supplied with visibility data in North American markets

Senato LinesSenato LinesHanjinHanjinAPLAPL CP ShipsCP ShipsNYKNYK Wan HaiWan Hai

On-line Trade Portal Freight Forwarder

confirm/B/L Info

booking request by data

                                                                                                  

GTNexus KILC

b

ookin

g

shipping instruction(S/R):ANSI 305

freight receipt invoice:ANSI 310

Booking, Visibility

booking

visibility

About 35 touch point data supplied:-Vessel, Container, Rail, Warehouse, Gate, Customs

Status Details:ANSI 315

V

isib

ility

visibility(GTNexus + Customs)

Korea Customs

visibility

-Vessel Arrival/Departure-In & Out Terminal Gate-In & Out Bonded Area-In bond Transportation

Log

istic

s T

ou

ch

Poin

ts

Member Shipping LineMember Shipping Line

Member Shipping LineMember Shipping Line

Member Shipping LineMember Shipping LineE-M

Ps

On Line Trade Portal

Importer Exporter

EDI Docu

Booking Visibility

Forwarder

KIL

C

on line booking

on

line

bookin

g

on line booking

booking relay

by UN/EDIFACT,ANSI X.12, etc.,

booking Vis

ibility

D

ata

visibility visibility

visibility

visibility

Im/exporter

b

ookin

g

visibility

vis

ibility

Interconnection of booking & visibility with KILC & e-MPs Booking from Korean customers thru KILC to e-MPs Visibility data from e-MPs to Korean customers thru KILC Enhancing collaboration with e-Logistics service paradigm

Expansion of KILC Services : Model for APEC

CargoSmart

INTTRA

Visibility data from Korea thru KILC to e-MPs KILC positioned to supply visibility data on export & import cargo

Export to e-MPs region

Import frome-MPs region

customs

B/L (manifest) data customs clearance ingate at terminal on board vessel vessel departure

B/L(manifest) data vessel arrival container unloading Outgate from port bonded transportation customs clearance

KIL

C

Member Shipping LineMember Shipping Line

Member Shipping LineMember Shipping Line

Member Shipping LineMember Shipping Line

customers

KTNET

E-M

Ps

CargoSmart

INTTRA

15

APEC centric Visibility Belt

VisibilityVisibility

VisibilityVisibility

VisibilityVisibility

VisibilityVisibilityVisibilityVisibility

VisibilityVisibility

VisibilityVisibility

VisibilityVisibility

Vis

ibilit

y Belt V

isibility

Belt

Centralized connection

Individual connection

To facilitate the movement of cargo in APEC region with e-Logistics To develop standardized visibility by country with mutually agreed consent or to use the existing similar system To exchange cargo status data with the representative visibility gateway To develop visibility belt along the pacific rim

Transparent cargo flow ensured by real/near time monitoring

op

tion

s

16

Visibility Connection under consideration Individual and representative visibility system connected one one : short term - Newly developed visibility - Modified existing system providing visibility functions Centralized visibility connection : long term - Simple connection and transfer of individual visibility - Visibility data conversion as single window

Visibility

Country ACountry A Country BCountry B

Country CCountry C

VANs

Logistics Service Providers

Touch PointsVisibility

Visibility

Country ACountry A

Country BCountry B

Country CCountry C

Country DCountry D

Visibility Visibility

Visibility Visibility

UsersUsers

UsersUsers

UsersUsers

UsersUsers

17

Visibility Data Standardization under discussion

Standardize the visibility data scope upon user’s requirements & LSP’s capacity Visibility data vary by country & service provider Examples as follows;

Empty outgate from ocean terminal (CY or port) Empty outgate from Inland or interim point Full ingate at ocean terminal Full ingate at inland or interim point (CY or port) On board vessel at the port of loading Full container discharged at port of discharge Full container from ocean terminal (CY or port) On rail Off rail

Customs released Carrier released Vessel departure from port of loading Full container discharged from transshipment Vessel departure from transship point Container available notice Empty & full container delivery Vessel estimated time of arrival & discharge Vessel arrived at port of discharge Container loading & unloading

18

One example of Visibility between China and Korea Trade volume between two countries on the sharp increase Collaborative and complementary relationship resulting in mutual benefits Visibility centric e-Logistics surely contributing to commerce & trade growth

Vessel Arrival

Unloading

Terminal Outgate

CY Ingate

ICD Ingate

Customs Clearance

B/L Receipt

Truck Location

Document Cleared

Vis

ibility

by K

ILC

KTNET

Forwarder

Customs Office

Log

istic

s T

ou

ch

Poin

ts

Korea ImportChina Export

E & P InternationalE & P International

Port of Shanghai

B2G data

B2B data

One example under APEC e-Logistics

VisibilityVisibility

VisibilityVisibility

19

Some practical steps for implementing e-Logistics in APEC

Procedures for follow-up

Discussion on the necessity of e-Logistics

If turning out to be necessary,

It needs to standardize the e-Logistics

Setting up sub-committee

To work out a master plan for APEC, 2005

To decide how to implement visibility

To select volunteers for pilot service

To carry out pilot service

To continue building up visibility belt

Need to talk about “possibility of e-Logistics” as a new paradigm

Questions?

Thank You!!!