Question

1. Your are exporting resin pellets to India. Determine the most appropriate incoterm based on the culture, infrastructure, and political climate of India (Use the Logistics Performance Index (found online) to help you with this). Choose an incoterm that will make our exported product attractive commercially to the importer in that country but also protects us as the exporter. Give reasons for your choice.
2. What city and/or ports in India would you recommend we export the resin pellets to (Possibly Mumbai Port or Kandla Port?)? Recommend the modes of transport that will be required to get the product from our factory in Houston Texas to the city recommended by you. Create a map of the route and identify each mode of transport and points of transition along the way. A point of transition is when the load is transferred from one entities control to another such as when it changes transportation modes and/or carriers. Identify any hazards that may be encountered on the route. This should help drive your choice for type of insurance (item d.) If you decide on air transport, justify your choice. Air is too expensive for most products. Note; even if your chosen incoterm does not require door to door delivery, your CEO wants details for the entire planned route of the product.
3. Determine the appropriate primary, secondary, and tertiary packaging required for the project.
   1. Does the primary packaging need to comply with any country specific cultural or legal requirements? For example, is certain information required for the labels or markings? Americans use feet and gallons as units of measure which is not consistent with the rest of the world. Does your primary packaging need to be reworked for your destination country?
   2. How will the product we moved while in our own warehouse or that of the customer’s (secondary packaging)?
   3. What packaging will be necessary to safely transport the product (tertiary packaging)? Consider the modes of transport, the infrastructure of the countries your product will pass through and the weather along the route.
4. Decide on the insurance that will be required for this endeavor. Remember to include not only cargo insurance to cover the entire route but possibly commercial credit insurance. Back up your recommendations with your cultural, infrastructure, and political climate research. For example, perhaps your country has a low Logistics Performance Index (LPI) score; you might want to consider adding “Strikes” and/or “Warehouse to Warehouse” additional coverage clauses to your transportation insurance policy.

Answer 1

a.   Your are exporting resin pellets to India. Determine the most appropriate incoterm based on the culture, infrastructure, and political climate of India (Use the Logistics Performance Index (found online) to help you with this). Choose an incoterm that will make our exported product attractive commercially to the importer in that country but also protects us as the exporter. Give reasons for your choice.

CIF( Cost, insurance and freight ) will be the most appropriate incoterm used for imports to India, unless explicitly specified by the importer. Since the import of resin pellets may require additional import formalities which can be done with ease through C&F agents in India. This makes the exported product attractive commercially to the importer in that country, as addition of port dues into the export bill can further escalate the cost of product as it deals with Foreign exchange.

b.   What city and/or ports in India would you recommend we export the resin pellets to (Possibly Mumbai Port or Kandla Port?)? Recommend the modes of transport that will be required to get the product from our factory in Houston Texas to the city recommended by you. Create a map of the route and identify each mode of transport and points of transition along the way. A point of transition is when the load is transferred from one entities control to another such as when it changes transportation modes and/or carriers. Identify any hazards that may be encountered on the route. This should help drive your choice for type of insurance (item d.) If you decide on air transport, justify your choice. Air is too expensive for most products. Note; even if your chosen incoterm does not require door to door delivery, your CEO wants details for the entire planned route of the product.

Kandla Port is one of the most popular hub for imports in India and it is the Special Economic Zone, and has most of the chemical and petroleum imports happening at this port.

MODES OF TRANSPORTATION- MULTIMODAL TRANSPORTATION

1.   Transport through Roadways from exporters factory at Houston Texas to south side wharves

Factory location not available

2.   Inland water transportation from south side wharves to Barbours Cut Container Terminal ( CIF borne by exporter)

3.   Barbours Cut Container Terminal to Kandla port ( Distance 11091 Km and takes 46.2 days to reach destination ( cost, insurance and freight borne by Exporter)

4.   Transport through Roadways from Kandla Port to importers premises ( cost, insurance and freight borne by Importer)

Factory location not available

Hazards likely to encounter during the transport is Hurricanes, shortage in product due to improper packaging, Fire accident , marine accidents etc..however for Natural disasters there is specific Disaster management plan to reduce the impact of loss.

c.   Determine the appropriate primary, secondary, and tertiary packaging required for the project.
i.   Does the primary packaging need to comply with any country specific cultural or legal requirements? For example, is certain information required for the labels or markings? Americans use feet and gallons as units of measure which is not consistent with the rest of the world. Does your primary packaging need to be reworked for your destination country?

Yes primary packaging need to comply with the country specific regulations .Packing plays a very important role in international trade. The packing can be in bulk boxes or tight palletatization. Do not use valved bags. The outer package has to be hard to prevent damage due to puncturing from pointed surfaces

ii.   How will the product we moved while in our own warehouse or that of the customer’s (secondary packaging)?

The packing can be in bulk boxes or tight palletatization, secured tight with adequate hooks for lifting during loading and unloading

iii.   What packaging will be necessary to safely transport the product (tertiary packaging)? Consider the modes of transport, the infrastructure of the countries your product will pass through and the weather along the route.

Use bulk boxes that cannot be punctured easily and follow the necessary instructions for disposing and reusing the containers with provision for lifting during loading and unloading

d.   Decide on the insurance that will be required for this endeavor. Remember to include not only cargo insurance to cover the entire route but possibly commercial credit insurance. Back up your recommendations with your cultural, infrastructure, and political climate research. For example, perhaps your country has a low Logistics Performance Index (LPI) score; you might want to consider adding “Strikes” and/or “Warehouse to Warehouse” additional coverage clauses to your transportation insurance policy.

A comprehensive - all risk insurance policy that provides full cover both total or partial from any external cause including loss due to shortage of products, theft, and act of god and also general breakage, water, fire accidents..‎