E-commerce, multiplier of Maritime Shipping
“Ideal model to develop Sri Lankan Shipping and has the potential to
convert the country as a shipping hub of Asia...”
As world progress into new millennium, the ongoing rapid advances
information technology have transformed global trading pattern and
humans lifestyle into a different dimension. This new dimension has
emerged since from 1980 and today everyone knows it as e-commerce.
Jaya and Unity container terminal (SLPA) |
The e-commerce is in forefront of world rapid advances, it smaller
the world day by day and year by year continuously. Today e-commerce has
affected as cannot be separated in arena of global trade including
service sectors. If someone said, I did some product purchase from USA
market or did some banking facilities or had a live conference with
foreign clients without moving from my seat, is not an anymore wonder on
today.
As shipping is one of an oldest industry, many years of practices the
shippers, consignees and carriers were reluctant or scared in
re-engineering in processing of a shipment due to risk involvement in
value of cargoes. However, as a result of global competition, world
economic and environment challenges, the maritime shipping has to give
its focus on improving process efficiencies, cost reduction, safety and
security aspects and manymore. Hence, as a largest, competent and
booming industry, which carries more than 80% of world tonnage of cargo
as more than 8 billions of tonnes per yearly by sea, the technology is
the forefront of sphere in maritime shipping.
According to maritime professionals, researches, moving tends and
practices one of the best available tool to achieve the management and
operational excellencies of maritime industry, is e-commerce; the
exchange of information, fund transfers, electronic processing and wide
range of activities are done over a electronic system among clients,
carriers and other related bodies via internet and other computer
networks.
The US and some EU countries have started the adaptation of e-commerce,to
their businesses since from 1980. As a result of this adaptation the
carriers, suppliers, traders and other related bodies have been able to
overcome most of challenges of arising trends of the global economy with
maximized profits and customer satisfaction. According to statistics in
2010, USA stands as the world leader in e-commerce as the market share
of USD 177 billion and the Europe as the world largest e-commerce
market. According to professional estimates, global e-commerce market
gross at around 19% and in 2013 it's expected USD 1.25 trillion as the
revenue of global e-commerce.
The reasons for this growth and revenue are the benefits behind in
e-commerce. A recent research has found out that 51 of the largest
container carriers in the world, serves their clients across 4 different
channels; web sites, EDI (Electronic Data Interchange), portals and
mobiles.
Mostly, the carriers use their own websites and systems for their
business processes and purposes. But, for the benefit of the whole
industry,the world leading and alliance carriers shared a vision of a
common industry portal. Hence, customers would not have to connect to
the different e-commerce systems of the individual carrier, but could
use one global standard for doing e-business. For example, by
facilitating e-commerce through a multi-carrier portal, customers can
streamline the whole shipment documentation process through a single
platform. Generally, the both websites and portal mostly use EDI for
document transactions in variety industries. In fact over 160,000
companies have made the switch to EDI to improve their efficiency and
accuracy of document transactions. Computer-to-computer exchange of
information is much less expensive and faster than handling paper
documents. Studies have shown that processing a paper-based order can
cost USD 70 or more, while processing an EDI order costs a dollar or
less.
Indeed, by facilitating e-commerce, customers can streamline the
documentation process with improve data quality, and faster response
times to things like booking requests and reduces errors in
documentation that can add costly delays to shipments, transferring of
sailing schedules, shipping instructions, track and trace are done in
efficient and cost-effective manner than conventional methods with
minimum labour time.
A Vessel Traffic Management System (VTMS) |
Hence, e-commerce is fast spreading all over the world. According to
various studies, the global e-commerce market will dominate in next few
years by the Eastern countries including China and South-East region.
And reports show the China e-commerce market grows 130% annually.
However, as a country which faces in rapid globalization and amidst
challenges in competitions between regional and international ports, Sri
Lanka has lot more to do with e-commerce. The existing e-commerce
position of the country is weak with comparison to the global level. As
we all know the country has a great position to consolidate as a
maritime hub, the government and private firms who're engage in maritime
industry should have a vision to adapt and exploit the advantages of
e-commerce to strength the country's economy. Today, the successful
adopters of e-commerce gain the most competitive advantages when they do
not see e-commerce as just a technology issue but as a business issue.
Hence, all interested parties should identify the incorporation of
E-commerce are beneficiary to almost all the commercial and legal bodies
who are dealing with maritime shipping, especially port authorities,
customs, shipping lines and its customers. E-procurement, E-operations,
E-marketing and E-selling enhance the use of E-commerce in the industry.
E-procurement functions of a shipping line can be ranged from buying
spare parts, bunker, provision, empty containers etc. via the internet.
For an example Electronic Invoice Presentment (EPI) is a tool used to
receive invoices online quickly, easily and accurately. And, it allows
the user to receive accurate billing information via emails. Plus he can
sign up to receive email notifications when invoices are sent, whether
they are electronic or paper.
But still in Sri Lanka, most of shipping instructions, bills of
lading and bookings other document related to imports, exports are still
made and transfer in inefficient and time-consuming conventional way,
via fax and phone. The adopting, e-commerce to industry encourages
exporters and forwarders to be more efficient, keeping costs down,
increasing customer satisfaction and improve the operating efficiency of
their supply chain. Thus, they could achieve greater visibility to the
data and can more easily share information with all their shipping
partners in a very cost-effective and a standard way.
To smoother the operational activities and ensure a better
co-ordination inside and outside the port and among shipping
communities, e-operation is widely used in world by numerous port
authorities, customs, shipping lines and its agents as a part of
e-commerce. For example, online berth bookings, e-orderings make it easy
for the particular port to give maximum satisfaction for customers by
pre arranges berth, equipment and workforce before the arrival of the
ship. Considering the Asian region, Singapore Port Authority (SPA), Port
Klang Authority (Malaysia) applies this as a tool to enhance its
operational efficiency, flexibility, safety and the competency among
regional ports. A fully automated system like Vessel Traffic Management
System (VTMS) performs a valuable contribution to safer navigation, more
efficient traffic flow and protection of the environment.
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When it comes to customs operations, the concept or the tool,
E-customs plays a remarkable role with increased control of the customs
office, less entry errors, electronic notice of VAT assessment, data and
communication standards, declaration possible 24 hours a day and more
transparent, faster import and export processes and the flexibility,
encourages small and medium enterprises to engage in international
trade.
As you can see the world leading and most competitive maritime
service providing countries and institutes do not see e-commerce as
something that is produced by their IT department. But, still the
majority of Sri Lankan government institute and private firms sees
e-commerce as something produced by their IT department. Instead that,
the leading service providers organize themselves around the business
processes so their whole business can benefit from access to better data
that's all in one place.
As the world moves, we all are compelled to move for our existence,
especially the businesses. But, every great thing has started from a
simple thing. That's the concept behind the success of many developed
countries. After 30 years of conflict as the Sri Lanka economy in a
recovery path, there's a small heading towards adapting of e-commerce
into local context. The Sri Lanka Port Authority (SLPA) has clearly
discerned that there is strong congruence between Information and
communications technology (ICT) and the maritime Industry. Hence, SLPA
has initiated computer facilities for its operational activities and EDI
service for container management. In 2004, the e-bill act was passed
from the Parliament and legally accepted the e-signature for the first
time in Sri Lanka. And Sri Lanka Customs has initiated a data system for
import and export and e-banking, e-manifest facilities. But, still the
SLPA, Customs required hard copies so as other related parties.
Indeed, implementating an e-commerce facility in any industry is not
an easy task. It's a long-term investment and needs a large capital to
invest on computer facilities, IT infrastructures and resources. But,
considering the huge potential for the industry, the government,
government institutes and private firms should open their eyes towards
new technology. The intervention of government, to encourage of Sri
Lankan maritime merchant shipping industry would be crucial at this
moment to make realize the vision of maritime hub of South Asia. New
rules and regulations should be implemented in arena of e-commerce. The
educating of benefits and correct usage of such system would be vital
for the shipping practitioners, shippers, consignees, forwarders and
other related parties to encourage the usage of such modern system.
In nutshell, e-commerce is a flexible solution for maritime industry
to be more efficient, keeping costs down and increasing customer
satisfaction. The global e-commerce market grows at 19% annually and
thousands of institutes and customers around the world adopting
e-commerce to gain competitive advantages. E-commerce can be taken as a
good business tool to emerge the potentials of Sri Lanka maritime
shipping industry.
Hence, the role of the e-commerce is massive towards the development
of maritime shipping as it has given the industry an opportunity to be
more accurate, efficient and profitable. |