第四方物流

在全球采购中的积极作用

The Contribution of 4th Party Logistics Supplier in Global Sourcing

1

Dalian

Shenyang

Ha’erbin

Changchun

Beijing

Shanghai

Wuxi

Chengdu

ChongqingWuhan

Shenzhen Guangzhou

Fuzhou

Qingdao

Supply Chain Management Solutions Provider

Holding the philosophy of bringing high value-added service to customers, CMT (CMT International Logistics Group) provides professional and efficient supply chain solution service;

CMT group locates its headquarter in Dalian, and establishes its subsidiaries and branches all-along China east coast and Yangtze River, where is the most economically developed area and attracts prevailing automakers and part suppliers to take as their production basis.

Tianjin

2High Value-Added Service

CMT successfully obtains approval and appreciation from a variety of customers. Taking automotive industry for example, a large number of state-owned enterprises, joint ventures and wholly-owned foreign companies have taken CMT’s service for long time.

Apart from automotive industry, CMT provides integrated logistics service in high-tech, high value-added industries or mass production enterprises as well. Those customers all have high level requirements on supply chain management.

3

1PL means that manufacturing or distribution companies manage logistics activities, in traditional sense;

Many definitions of 2PL exist, among which the most popular one is that "buyer, seller or distribution companies organizes logistics activities". Another popular definition is "manufacturer entrusts trucking company or warehousing company to handle transportation or storage activities, which is a kind of functional service";

3PL means that logistics companies provide specialized logistics service to manufacturing and distribution companies, so that the manufacturing and distribution companies can focus on their main business.

4th Party Logistics

4

4PL – 4TH PARTY LOGISTICS was first proposed by Accenture, USA in year 1998.

Accenture defines that, 4PL provider is a supply chain integrator who assembles the resources, capabilities and technology of its own organization and other organizations to provide comprehensive supply-chain solutions;

What we define 4PL is “logistics system integrator”, although someone regards 4PL company as consulting company, and some others name logistics consulting as 5PL. The 4PL we are referring to is a “logistics system integrator” who is capable in integrating all internal and external resources in every steps of supply chain management, from program planning, solution development up to physical logistics service (including transportation, storage, supervision, information etc.).

4th Party Logistics

5

Cost breakdown of Global Sourcing (Example)

Budget cost：A company made global sourcing “micro-motors” in China and then exported to USA in 2002. The budget cost had been 20% lower than the purchase cost in USA.

Part cost: 30% lower than USA;Quality cost: 1-3% higher than USA, mainly developing and approving cost; Currency exchange risk: potentially 3% higher;Logistics cost: can be 3% higher for some low-value commodities, including packaging and transportation; Tax and others: 1% higher than USA.

Purchase costin USA

Partcost

Qualitycost

Currencyexchangerisk

Logisticscost

Tax &others

Purchase costIn China

Budget Cost

+3% +3% +3% +1%

6

Actual cost: After analysis on the actual operations, it was found in 2007 that only 8.5% cost down was realized.

Part cost: actually lowered 32%;Quality cost: actually increased 3%;Currency exchange risk: actually increased 13%;Logistics cost: actually increased 6.5%;Tax and others: actually increased 1%.

+3%

+13%+6.5%

+1% -8.5%

Purchase costin USA

Partcost

Qualitycost

Currencyexchangerisk

Logisticscost

Tax &others

Purchase costIn China

Cost breakdown of Global Sourcing (Example)

Actual Cost

7Analysis on the Over Budget Cost

The sourcing center requests each of micro-motor suppliers purchase spare parts separately, export to USA separately without any consolidation. Using LCL/LCL mode or half-empty containers causes increased ocean-freight and land haulage cost;

The volume has not been well accumulated to reach a “bigger” scale for lower freight rate;

The export parts does not match each other well, which causes high inventory and possible air-shipment due to improper management;

The supplier is requested to setup 6 wks safety stock. As least 13 wks inventory in total, if plus the inventory in transit, which causes serious funds tied up;

Extended tax refund increases financial cost of the suppliers.

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Other Examples in Global Sourcing

Confusion of acoustic package:The purchase cost in China is 45% lower than that in foreign countries; Big volume but light cargo;Low value (a majority of China export cargo is in low value);Due to lots of extra expenses, such as long-distance transportation, storage, financial cost, etc., the sum cost up to American plants does not have any price advantages, compared with the purchase cost in USA directly.

On the contrary, some cargoes are very heavy but low-value, logistics cost has big influence on the total cost. They meet the same confusion in export.

To sum up, a big portion of problems in global sourcing in China relates to logistics.

9Value-Added Service by 4PL

Information platform:Real-time check inventory (both in transit and in warehouse), check quantity and status of each particular part at all steps; Set up Logistics-BOM, describing package, transportation and storage status;Based on bill of material, be aware of current inventory (in-transit, in warehouse and in depot) and short-part statistics.

SPKEY PART NO PART NO PART NAME RLMeasuring

pcs.

Measuringweight(g)

Caseclssification

CaseType

L(Cm)

W H转换包装

PackagingSpecific Code

QuantityGrossWeight

03000FST0 FST0-03-000B FST003000B TRANS COMPT 3B 总装件 1 80000 303000FST1 FST1-03-000 FST103000 TRANS COMPT 3B 总装件 1 80000 303000G602 G602-03-000 G60203000 TRANS COMPT 3B 总装件 1 41400 312717RF2B RF2B-12-717 RF2B12717 BOLT-TENSIONER 31 总装件 10 344 2 A10 24 14 12 LA1 200 702913215ZL01 ZL01-13-215 ZL0113215 SENSOR-AIR FLOW 31 总装件 1 52 2 A25 24 56 24 LB1 160 884813390L327 L327-13-390 L32713390 INSULATOR ASSY-EXH 32 总装件 1 500 2 C30 48 56 24 Y LB1 10 61761342YL510 L510-13-42Y L5101342Y BRKT ASSY-FUEL HOSE 31 总装件 1 279 2 C30 48 56 24 Y LC1 16 56401345XLFK5 LFK5-13-45X LFK51345X MANI SUBASSY-EXH 3B 总装件 1 6090 31345XL3M7 L3M7-13-45X L3M71345X MANI SUBASSY-EXH 3B 总装件 1 6090 313460L327 L327-13-460A L32713460A GSKT ASSY-EXH MANI 31 总装件 1 115 2 A25 24 56 24 LB1 85 1030313924LFTK LFTK-13-924 LFTK13924 BRKT 31 总装件 1 24 2 A10 24 14 12 LA1 140 348913925LFTK LFTK-13-925 LFTK13925 BRKT 31 总装件 1 26 2 A10 24 14 12 LA1 160 428915182AJ51 AJ51-15-182 AJ5115182 CLAMP-WATER HOSE 31 总装件 200 5150 2 A20 24 28 24 LA1 200 548915538B6BF B6BF-15-538 B6BF15538 CLAMP-HOSE 31 总装件 3000 8730 2 A10 24 14 12 LA1 750 231215980LFG1 LFG1-15-980C LFG115980C TENSIONER-AUTO 31 总装件 8 8000 2 A20 24 28 24 LE1 8 930016410LF02 LF02-16-410 LF0216410 COVER ASSY-CLUTCH 32 总装件 1 4700 2 C30 48 56 24 Y LD1 3 1480016460LF03 LF03-16-460A LF0316460A DISC ASSY-CLUTCH 32 总装件 1 1400 2 A25 24 56 24 LD1 10 145001744XG501 G501-17-44XA G5011744XA COVER ASSY-HOLE 32 总装件 1 25 2 A20 24 28 24 LA1 100 2839

Part weight Module(纸箱)

Case Dimension

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Logistics platform:4PL company may participate in logistics solution planning with auto part manufacturer from the beginning of the project, providing professional support (packaging, transportation, storage, information, traceability, EDI, etc);Advantages in organizing logistics platform:

> take flexible advantage of pull system, consolidation, milk-run, cross-docking, distribution, JIT, etc;

> “professional and scale” help customers lower cost and inventory;

> “logistics plus trading” assist customers optimize utilization of limited cash;

> Speed up export tax refund.

Value-Added Service by 4PL

11

Training platform:Give training to the relevant employees, customers and suppliers, to improve understanding and communication.

Value-Added Service by 4PL

CMT training center gives simulation training to logistics distribution operators.

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Customized developmentContinuous adjustment and improvement

Customer requirement

Customer solution

Global service system

CMT optional solution

Comparison

Optimization

System System integrationintegrationDesigning Resources

allocation

CMT provides customized services on the premise of standardized operations, implementing as below.

Start from customers’ requirement, usually from bill of material and standard “customer requirement checklist”;

Based on standard individual service module, there is a large range of permutations and combinations among those modules. It makes customized package solutions available for customers.

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

Case of Implementationcustomized services on the premise of standardized operations

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Make every effort to help customers find a optimized solution to solve any problems in supply chain;

Take “Account Management System”, in order to better serve customers with clear responsibility. The account managers strictly follow the project management process;

Ready with many operation contingency plan.

Get internal or external approval in our simulation training center, if necessary;

Quality control to guarantee the excellence of QCD.

Case of Implementationprogram planning and organization

Program planning, similar as project management of auto part manufacturers.

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

14 14

Pickup atsuppliers

Ocean

Shipm

ent(from C

hina to Europe)

Arrival in E

urope PO

D

2-3w

eeks safety stock

Week 7Week 1 Week 2 Week 8Week 3 Week 4 Week 5 Week 6 Week 9

Pre-carriage, C

onsolidation, D

ocumentation.

Export C

ustoms C

learance, S

hipped on Board

Departure ex C

hinaO

PO

L

Import C

ustoms C

learance, G

oods Release, D

istribution

Goods R

eady for Production on C

all-off

Case of Implementationin-transit inventory control

15Strong IT System Platform

The logistics module of the IT system is open to the authorized customers via internet, assisting customers to trace and track their cargoes;

EDI link with customers, suppliers or business partners;

Be aware if the inventory satisfies customers’demands of production, based on document and information like bill of material, etc.

Information flow is the basis of supply chain management, and is one of major value-added services to customers as a 4th party logistics service provider.

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Ex : 25 cars set with 5 containers

Ex : 25 cars set with 5 containers

Principle of Long distance JIT

Supermarket in China Workshop in Europe

スス

ス

キ

ス

キ

ス

キ

ス

キ

ススス ス

ス ススス

配货指示

装箱单装箱单

装箱单

装箱单

CKD配货、转换包装区

转换包装区

CKD合捆区

A类零件

W类零件

大件货

CKD待发区A类零件

W类零件

W类零件

大件货

外协零件

CKD装载区 A类零件

CKD

W类零件CKD

空箱

供应商

国产化配送中心

检收区 待发区

其它零件

生产线

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

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Carmaker or end-user

Carmaker or end-user

Carmaker or end-user

Carmaker or end-user

Auto-parts supplier

Auto-parts supplier

Auto-parts supplier

Auto-parts supplier

CMT’s JIT delivery has different models:

- Service for a single carmaker;

- Service for many auto-parts suppliers;

- Service for many carmakers and many auto-parts suppliers.

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

Supermarket JIT Deliveryfor Auto Parts

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Logistics Financial Service

CMT provides logistics financial services together with financial institutions, to help customers effectively break the bottleneck of funds in the supply chain, improve their capital utilization, and optimize capital allocation for customers.

Through a series of relative financial planning and financial products, CMT logistics financial service helps customers solve financing problems, activate deposited funds, speedup capital turnover, reduce settlement risks, to then improve their economical operation quality.

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

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The bonded logistics service of CMT covers international transshipment, international distribution, export re-import, inbound bonded storage and distribution, tax refund of export cargo upon entry into Free Trade Port Area, etc.;

Bonded logistics is an efficient way for CMT to extend the most preferential conditions of Free Trade Port Area to inland regions and help inland plants get more development opportunities.

Bonded Logistics Service

Logistics Financing

Logistics Real Estate

Warehouse& Depot

BondedLogistics

JIT Delivery

Domestic Transportation

Customs Clearance

ConsolidationDeconsolidation

International TransportationTradingPlanning

谢 谢

Thank you