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The
company plans to build a hub in the Southeast Asia region for shipping products
to other specific countries. Among nine countries in this region, there must be
one selected country to locate the hub. Before making this plan real, the
company needs to consider several factors including the customs, quality of
transport, and all the necessary logistics functions.
The
World Bank has released the Logistics Performance Index (LPI) 2016 and
indicated Germany as the best country for logistics. Following Germany, one of
the Southeast Asia countries ranked 5 among all countries in the world. The
country is Singapore. Since the company is looking for the transshipment hub in
Southeast Asia region, Singapore deserves as the best choice. The LPI is
measured by several indicators including customs, infrastructure, international
shipment, logistics competence, tracking and tracing, and timeliness. Each of
which Singapore is included in the top 10 country. Singapore achieved first
rank for the custom indicator with the score of 4.18 where Germany is only
4.12. This indicates customs in Singapore will not become a burden for company
to locate the hub and do transshipment. The transshipment activities are
regulated by Singaporean Government under the Customs Act, the Strategic Goods
(Control) Act, the Regulation of Imports and Exports Act, and other related
legislations. A specific system for this matter is called TradeFirst. This
system will provide company a greater convenience and facilitation through six
assessment frameworks; company profile, procedures and processes, security,
inventory management, other scheme-specific requirements, and compliance
(Singapore Government, n.d.).
Furthermore,
Singapore commits to create efficiency in the supply chain and logistics hub.
They transform the procedure and regulation related to security and the
operation to be simpler allowing company better adapt with Singaporean and any
international customs. This creates an ease for company to get clearance,
documentation, as well as a permit towards their products. An application has
been built in Singapore called TradeNet. This gathers around 35 controlling
agencies to assess and give permit to company for trading activities. Despite
the business-friendly customs, Singapore is located strategically in the heart
of Southeast Asia making it an important hub for the meeting point of major
shipping lanes. The quality of the transport is measured by the facilities
provided in this country. Singapore hub is facilitated by the world class
infrastructure such as Airport Logistics Park of Singapore, Changi
International LogisPark, and Banyan LogisPark. All of these infrastructures are
specialized to serve domestic and international distribution. Thus, among 25
global logistic firms, 20 of them are operated in Singapore (EDB, n.d.).
The
aviation hub in Singapore has AS9120 certification with various capabilities.
1. Aircraft-on-ground
(AOG) for fast delivery of missing part to the waiting-aircraft.
2. Service
Parts Logistics (SPL) for aftermarket facilities.
3. Integration
of the airline inventories.
4. Master
of the engines and other related functions of the transportation.
In
addition, it is also providing packaging facilities and chemical processing in
the Jurong hub by implementing the system of Katoen Natie. The Vopak has also
built its facilities there, providing the chemical storage, distribution system
for domestic market, and other services for better chemical substances quality.
The electronics product is also be supported by the DB Schenker by building the
Competence Center focusing on the Production Vendor Managed Inventory (PVMI).
This will help Singapore managing the electronics and other manufacturing
sector. In terms of healthcare and cold chain logistics, Singapore is facilitated
by the Coolport offering storage with the temperature ranging from -28°C to 19°C. This Coolport has
also a Halal certification (EDB, n.d.).
The
potential of transshipment in Singapore will be maintained by its domestic
resources, especially the human resources mastering in supply chain management
and logistics. The education in science and engineering offer variety programs for
creating potential talents in this industry. The EDB mentioned that the graduates
with specialization in Supply Chain Management in Singapore have reached 8,500
people. It also offers double masters program nurturing over 150 professional
who work in SCM field. Despite the educational system, Singapore conducts
TLI-AP THINK Forum gathering experts and professionals in SCM to discuss and
outline potential SCM and logistics to be developed and maintained in Singapore
(EDB, n.d.).
Singapore
is ranked first for logistics in Southeast Asia. It has a business-friendly
customs and world class infrastructures supporting the transshipment. These
infrastructures ranging from aerospace to healthcare and cold chain logistics
will ensure the quality of the transport. The government has also collaborated
with educational and other institutions to maintain the quality of the logistics
and supply chain processes. Its human resource will be prepared to be the
expert and professional in the SCM field.
Sources:
Singapore
Government. (2017). TradeFirst. Retrieved
from https://www.customs.gov.sg/businesses/customs-schemes-licences-framework/tradefirst
Singapore
Government. (n.d.). Transhipment
procedures. Retrieved from https://www.customs.gov.sg/businesses/transhipping-goods/transhipment-procedures
EDB.
(n.d.). Logistics and supply chain
management. Retrieved from https://www.edb.gov.sg/content/edb/en/industries/industries/logistics-and-supply-chain-management.html
The
World Bank. (n.d.). International
scorecard. Retrieved from http://lpi.worldbank.org/international/scorecard/column/254/C/MYS/2016/C/SGP/2016/C/BRN/2016/C/KHM/2016/C/IDN/2016/C/MMR/2016/C/PHL/2016/C/VNM/2016/C/THA/2016/C/BRN/2016?sort=desc&order=Customs#datatable
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