supply chain management of colombo dockyard plc

Content

• About Colombo Dockyard PLC

• Supply Chain Management – Introduction

• Supply Chain Management & business strategy

• Incoterms 2010

• Important documents related to the SCM

• History of the shipping Document

• Supplier Network

• Challenges and risk strategies

• New Trend in SCM

“…an Odyssey of Excellence”

Colombo Dockyard PLC

About Us



About us

• Est: 1974 • Ship repairing • Ship building • Heavy engineering • Offshore engineering • 125,000 DWT graving docks capacity • More than 3500 no of total employment



Evolution of Colombo Dockyard PLC

1975 Commencement

of steel shipbuilding

1974 Incorporation

of CDL with

3 dry docks

Incorporation

of CSA

1976

1st Tug Boat

for Colombo

Port Commission

1978

1981 Incorporation of

Ceylon Bulk Carriers Ltd

and renamed as CDGE

Incorporation of CDL

as a private limited

liability company

1st offshore patrol vessel

1982

CDL converted into PLC

and BOI company.

1st export order in

shipbuilding for

Myanmar

1983

1987 1st Ship building

project to the Maldives

Hull 78-81

Fish collector vessels

CDPLC commences

operation of the

125,000 DWT

newly built Dry dock

1988

1992 Commencement of

Aluminum shipbuilding

in Sri Lanka

1993

Major re-structuring

of CDPLC &



Remarkable event of the odyssey



About us cont…

• Core values

- flexibility

- innovation

- being customer centric

- environmental friendly

- people focused



About us cont…

Ultra Fast Attack Craft (Series II)

Petrol Duties of Sri Lanka Navy

Length – 24.03m

Loading – 52.0T

Speed – 45 knot

Endurance – 500Nm

Combat system

Missiles: AGM-114 Hellfire (Surface-to-surface type)

Guns: 2x20 mm AA, 2x12.7 mm MG, one 84MM Recoilless gun

Radars: 1 Raytheon type

E/O: El-Op MSIS Weapon Director



https://en.wikipedia.org/wiki/AGM-114_Hellfire



https://en.wikipedia.org/wiki/Recoilless_gun

About us cont…

Ultra Fast Attack Craft (Series III)

Petrol Duties of Sri Lanka Navy

Length – 24.03m

Loading – 52.0T

Speed – 53 knot

Endurance – 500Nm

10 heads per boat



About us cont…

MPSV – Multipurpose supply vessel • Long – 78m • Speed – 13.8 knot • Popular in Gulf region • Vessel is to support offshore oil & gas field



About us cont…

200 passengers cum 100T cargo vessel



About us cont…

• Second Class – 40 passengers

• Bunk Class – 350 passengers

• Crew – 69 persons

• Speed – 15 knots

• Fuel Oil – 400 T

• Length overall – 99.00 m

• Breadth mld – 17.00 m

• Depth – 9.20 m

• Design Draft – 4.20 m

• First Class – 10 passengers

400 passengers cum 250 Tons cargo



About us cont…

Ship Repairing

Main repairing areas Machinery repairs Hull repairs Propeller repairs Electrical repairs Electronic and automation repairs Cargo gear repairs Internal tank, cargo hold blasting and coating

Maximum capacity of up to 125,000 DWT and over 1000 meters of fully serviced alongside repair berths.



About us cont…

Colombo Dockyard has made significant progress and been able to forge into top end repair markets in the offshore sector. The Offshore Engineering division has managed some unique retrofits and repair work creating history in the local maritime industry.

Offshore Engineering



Major components of the multipurpose supply vessel

1. Stern roll for anchor handling 2. Stoppers for anchor handling 3. Steering engine 4. Starboard ducted propeller 5. Stern tube 6. Transverse thruster 7. Cofferdam 8. Tanks for dry bulk cargo e.g. cement 9. Mud tanks 10. Propeller shaft 11. (Reduction) Gear box 12. Main engine 13. Fire pump 14. Life rafts 15. MOB-boat with crane 16. Storage reel for steel wires for anchor handling 17. Anchor handling winch 18. Bridge with controls for deck gear and ship’s steering 19. Fire fighting monitor 20. Radar antennas 21. Antenna for communication system / satellite antenna 22. Watertight bulkhead 23. Anchor windlass, below deck 24. Azimuth thruster 25. Bow thruster



Supply Chain Management



Why supply chain management? History

• Sun Tzu (ancient Chinese military general, strategist and philosopher and author) - The “Art of War” more than 2500 years ago

• QC Management – Can you manage and improve the quality standard of your product or service measured by the end-consumer w/o managing the suppliers and buyers ?

• Direct link with the cash flow management of a company



Supply Chain Management

Group of inter-connected participating companies that add values to a stream of transformed inputs from their source of origin to the end products or services that are demanded by the designated end-consumer

Major categories of SCM

- product Flow

- information flow

- finance Flow

- commercial flow

Definition



Why supply chain is important for the CDPLC ?

• More than 65% of the total cost of production contribute by the materials

• Non of the marine quality materials are not producing in Sri Lanka

• entirely depend on the international market

• Able to make significant impact for the top line

• Quality materials deliver at the right time with the minimum cost is requirement



SCM & BUSINESS STRATEGY

• We believe that a supply chain that is closely aligned with business strategy helps to advance business objectives and achieve sustained, profitable growth. While business strategy should drive supply chain design decisions, it is also critical to execute well on all of the supply chain’s tactical dimensions.

• In a recent Bain survey, C-suite and supply chain executives agreed that supply chains are at the heart of outstanding performance. Nearly 90% of all executives surveyed felt that supply chains promote competitive advantage, are critical for satisfying customers and, at the same time, have significant room for improvement.

• Our supply chain consultants have teamed with hundreds of clients on more than 1,500 engagements across all industry verticals. In working with client teams, we clarify supply chain priorities by bridging the gap between strategy and design and ensuring successful implementation, backed by operational expertise, to make the results stick.



http://www.bain.com/publications/articles/Turn-your-supply-chain-into-a-profitable-growth-engine.aspx

High performance SC setup flows from the business strategy

Key Question * What is our overall business strategy ? How will we win today ? * What must the supply chain deliver to best support our business strategy



How do Lean, Agile, and “Leagile” Supply Chain Strategies Compare?



Procurement Process of New Construction

Arrange the payments

Appoint 3PL

Collect the Shipping

Document

Customs Clearance

Incoming inspection

Store the goods

Issue the goods

Design the

vessel

Planning the material

required dates

Prepare the MOC

(Material Ordering Card)

Check against the available

general stock

Allocate the goods from

available stock

Forward to Procurement

In-charge

Accept the MOC & Select

the sourcing category

Foreign Purchase Local Purchase

Purchase Enquires

Evaluate Technical

specifications

Recommend a quotation

with the reasons

Evaluate the commercial

and logistics aspects

Purchase Approval

Purchase Order / PO

Order Acknowledgement



Procurement Process of Ship Repairing

MOC

Stores

Purchase Enquiry

Recommend the quotations by end user/Production

Purchase Order

Price Approval

Invoicing Engineer negotiate with vessel owner

Collect the Quotations



Incoterms 2010 (8th version)

The Incoterms rules or International Commercial Terms are a series of pre-defined commercial terms published by the International Chamber of Commerce (ICC). They are widely used in International commercial transactions or procurement processes. Main purpose is to demarcate the responsibility and assist in the complex situations to avoid any conflict • FOB • CIF • CFR • CPT • EXW



MOC – Material Ordering Card



Vital Areas of the MOC • Description/ Technical

specification • Required date (This need to

submit by planning team)

Purchase Enquiry



Purchase Enquiry • Minimum 10 or more P/E s needs to send per

item • Need minimum 3 or more quotations to

proceed further • This is directly link to cost factor

Purchase Order



Purchase Order cont….



• Most vital document and legally enforceable document

• Currency code, Description, qty, required date, delivery date, shipping term need to specifically mention

• Shipping marks and nos, warranty • Signature of the head of the division

Payment Term

• Advance – T/T

• Balance – Letter of credit

• Credit – 30/60/90 days etc

Proforma invoice is compulsory to arrange any of the above payments except credit payment

Credit payment required commercial invoice and GRN to settle the payment



Payment Term cont…

• letter of credit/ Irrevocable letter of credit (LC/DC) can not cancelled or modified w/o consent of the parties involved

• an irrevocable letter of credit is a guarantee from a bank, issued in the form of a letter. These letters allow companies (and individuals) do to business with confidence.

• letters of credit are often found in international trade, but they can also be used for domestic transactions. The details of each deal are not as important as the concept of a bank promising to pay a “beneficiary” once something happens.

banking.about.com



Payment Term cont…..



Advance payment / LC Payment • Use proforma invoice • Currency code, shipping term as

per the PO • Once remitted need to send the

T/T copy and get the acknowledment

Payment Term cont…

Letter of credit

• Bank to bank formats are differ

• Content is same

• This is separate subject and need to learn from the superior/ experience person while doing the actual job

•

For more details, www.investopedia.com/terms/i/iloc.asp



Payment Term

Letter of credit SWIFT

Copy issued by the bank



Shipping documents - History

• 13th Century • Codified provisions on bills of lading may be found in the 1924

Hague Rules, the 1968 and 1979 Hague-Visby Rules, and the Hamburg Rules.



https://en.wikipedia.org/wiki/Hague_Rules

https://en.wikipedia.org/wiki/Hague-Visby_Rules



https://en.wikipedia.org/wiki/Hamburg_Rules

Shipping Documents



• Read well • Consignee address • Shipping marks and nos • Weight and dimension of the package as per the agreed rate of

3PLs • Check whether “SURRENDER/EXPRESS/WAY BILL/TELEX”

released stamp • On board date must appear • Signature must appear • Vessel name and Voyage no Tracking purpose http://www.marinetraffic.com/ https://www.flightradar24.com/59.75,16.76/6

http://www.marinetraffic.com/



https://www.flightradar24.com/59.75,16.76/6

https://www.flightradar24.com/59.75,16.76/6

Shipping documents



• Identify the master/ housing awb • Flight arrival schedule • Size and dimensions • Always need to collect the AWB from the

line office • FAN is compulsory pre-arrangement of the

customs documents • /cusdec preparation • Make sure non of the declaration stated

as damage cargo/ missing cargo

https://www.flightradar24.com

https://www.flightradar24.com/



http://www.marinetraffic.com


Shipping Documents



• Signature is compulsory requirement • Price • Qty • Description ( Nos/ code system rejecting by the

Sri Lanka customs) • Description ( Doors, Dongle, Valves, Electric

Motor) • Shipping term • Price (If term CIF, Freight charge need to display

seperately) • No of pallets • If declare the payment term need to find the T/T

references for the advance payments or other payments.

• Supplier’s bank account no, IBN NO, swift • If the recipient is BOI company need to state

BOISL No

Shipping documents



Need to declare the items in details Qty, no of crates, pallets, boxes Shipping marks and nos Cargo clearence party must aware of the item

Supplier Network



http://www.daeyang.co.kr/

http://www.daeyang.co.kr/

Challenges, Strategies & Risk Management

Challenges

• Price Fluctuations • Trustworthy sources • World Economy • Changes of the project requirement • Natural Disasters, Local & Foreign legal Barriers (TRC, Defense etc)

Strategies

• Finding reliable Sources with competitive price. • Mutual relationships with suppliers • On time delivery (JIT –just in time)

Risk Management

• Changing delivery terms (Incoterms 2010) • Payment methods (LC) • BG, Performance Bond, agreements etc



New trends in SCM

• Green supply chain Pepsi/Coke saved $44 by switching from corrugated to reusable plastic containers, Global warming, eco friendly, Less material usage designs, minimum operations, achieving of economies of scale • AI (Artificial Intelligence) embedded for the SCM • RFID enhancement • Reverse logistics



Q & A



supply chain management of colombo dockyard plc

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