Improving air freight service for medical equipment import at airseaglobal vietnam joint stock company

To complete the research paper on the topic "Improving air freight service for medical equipment import at Airseaglobal Vietnam Joint Stock Company ", I would like to express my deep gra

ACADEMY OF POLICY AND DEVELOPMENT

INTERNATIONAL SCHOOL OF ECONOMICS AND FINANCE

GRADUATION THESIS

Topic: “Improving air freight service for medical equipment

import at Airseaglobal Vietnam Joint Stock Company”

In fact, behind every success of a research, it is impossible not to mention theenthusiastic help of teachers Therefore, I would like to express my deep gratitude to theteachers at the International School of Economics and Finance - Academy of Policy andDevelopment, especially my instructor – MA.Doan Anh Tuan, who has been dedicated toteaching and caring, guide, and create conditions for me to be able to best complete thegraduation thesis

To complete the research paper on the topic "Improving air freight service for medical equipment import at Airseaglobal Vietnam Joint Stock Company ", I would

like to express my deep gratitude to all managers and staffs in the Joint Stock CompanyAirseaglobal Vietnam has enthusiastically helped and trusted to provide me with enoughinformation to be able to complete my thesis

Although there are many efforts to implement the thesis in the most complete way,but due to the limitations of knowledge and experience, it is inevitable that there areshortcomings that I have not seen myself I look forward to receiving suggestions fromteachers and interested people to help the topic be more complete

To complete this thesis, I have researched the actual competitiveness of import andexport freight forwarding services by air at Airseaglobal Vietnam Joint Stock Companybased on the knowledge I have learned at the Academy of Policy and Development Onceagain, I would like to sincerely thank the teachers at the Academy of Policy andDevelopment and managers and staffs in Airseaglobal Vietnam Joint Stock Company forhelping me in the past time I would like to wish your company always develop and besustainable, wish all members in the company and teachers always healthy and successful

Best regards!

StudentDien Ngoc Anh

TABLE OF CONTENTS

Contents

ACKNOWLEDGMENT i

LIST OF ARRIVAL CHARACTERS iii

LIST OF FIGURES iv

LIST OF TABLES v

INTRODUCTION 1

Chapter 1: Theoretical basis for import and export goods delivery by air 4

1.1 Overview of import and export freight forwarding activities 4

1.2 Professional process of forwarding and receiving goods imported by air 12

1.3 The criteria for evaluating the results of business activities of import and export freight forwarding services 20

1.4 Factors affecting business activities of freight forwarding services by air 26

Chapter 2: Analysis of the reality of delivery and receipt of imported medical equipment by air at Airseaglobal Joint Stock Company 32

2.1 Current status of medical equipment delivery at Airseaglobal Joint Stock Company 32

2.2 Medical Equipment overview 41

2.3 Reality of forwarding activities at Airseaglobal Joint Stock Company 45

2.4 Analyzing and evaluating the process of receiving imported medical equipment from Airseaglobal Joint Stock Company 59

Chapter 3: Solutions to improve the quality of air freight service for medical equipment import at Airseaglobal Vietnam Joint Stock Company 71

3.1 Orientation to develop the delivery service of medical equipment imported by air at Airseaglobal Vietnam Joint Stock Company in the coming years 71

3.2 Solutions to improve the process of delivery and receipt of medical equipment by air at Airseaglobal Vietnam Joint Stock Company 72

3.3 Several recommendations for state agencies 76

CONCLUSION 82

REFERENCES 83

ii

LIST OF ARRIVAL CHARACTERS

LIST OF FIGURES

Figure 1 1: Import and export freight forwarding process 13

Figure 1 2: Steps to do customs procedures 15

Figure 1 3: Method of net sales growth rate 22

Figure 1 4: Method of Profit growth rate 22

Figure 1 5: Method of ROA 25

Figure 1 6: Method of ROE 25

Figure 2 1: Organization chart of the company 34

Figure 2 2: Chart comparing revenue and profit in recent years of Airseaglobal Joint Stock Company 37

Figure 2 3: Chart of the proportion of business sectors contributing to Airseaglobal's revenue in 2020 38

Figure 2 4: Bussiness Ratios 41

Figure 2 5: The percentage of capital used by the company for operations 56

Figure 2 6: The process of delivery and receipt of medical equipment by air at Airseaglobal Vietnam Joint Stock Company 62

Figure 2 7: The process of electronic clearance of medical equipment 66

iv

LIST OF TABLES

Table 1 1: The legal system governing air freight forwarding and forwarding services in

Vietnam………31

Table 2 1: Revenue and profit in recent years of Airseaglobal Joint Stock Company 36

Table 2 2: Growth rate of the company in the period 2018-2020 39

Table 2 3: Total asset and equity 40

Table 2 4: The proportion of quality goods delivered by Airseaglobal Joint Stock Company 46

Table 2 5: Freight forwarding volume of Airseaglobal Joint Stock Company from 2018 to 2020 47

Table 2 6: Equipment in stock of Airseaglobal JSC 53

Table 2 7: Number of employees of the company by age 54

Table 2 8: Total capital of the company 55

Table 2 9: Purpose of using capital of the company 55

Table 2 10: Total volume of imported and exported goods transported by air 57

Table 2 11: Total number of shipments delivered by Airseaglobal Joint Stock Company in recent years 58

Table 2 12: Number of customers of the company in recent years 58

Table 2 13: The company main import routes 60

Table 2 14: Results of delivery of medical equipment shipments of the company in the past 3 years 61

1 The urgency of the subject

Currently, the process of globalization and integration is growing, makingeconomic activities in general and international economic activities in particular go up at

a stronger speed Grasping that situation, the international freight forwarding market isalso very exciting, businesses compete with each other to gain prestige and great position,towards sustainable development in the future Import and export freight forwardingservices make trade activities easier to circulate, helping production, trading and import-export enterprises save costs thanks to production specialization Besides sea freightforwarding, which is still bringing great advantages to businesses, air freight forwardinghas also become exciting and competitive in recent years

In Vietnam, there are more than 2,000 forwarding companies and will increasesignificantly, leading to fierce competition in the market International freight forwardingservices are associated with the economic development of each country The systematicstudy of issues related to international freight transport is an urgent requirement forofficials working in freight forwarding, importing and exporting

Airseaglobal Vietnam Joint Stock Company has been operating in the market forabout 9 years, in addition to the delivery and receipt of medical equipment by sea, thecompany's air freight forwarding activities still account for the largest share big.However, this activity is still not in the top position because a number of weaknesses inthe process of making import documents, receipt and delivery procedures have not beencompletely overcome Therefore, it is imperative to find effective solutions to overcomethe shortcomings so that the air delivery and delivery of medical equipment by airbecomes more efficient and achieves a higher frequency Because of the above reasons, I

have chosen the topic: " Improving air freight service for medical equipment import

at Airseaglobal Vietnam Joint Stock Company ".

1

2 Purposes and tasks of the research

The purpose of the study is through analyzing the current situation to proposeorientations and solutions to improve the delivery and receipt of medical equipment by air

at Airseaglobal Vietnam Joint Stock Company

To achieve the above goal, the study carried out the following research tasks:Systematize the theoretical basis of freight forwarding by air, the steps in thedelivery and receipt process, the factors affecting the forwarding process of Logisticscompanies;

Analysis of the reality of medical equipment delivery by air at Airseaglobal

Vietnam Joint Stock Company;

Analysis of influencing factors; assess the positive and negative aspects of the company's air delivery and delivery of medical equipment;

Solution offered to complete the process of delivery and receipt of medical

equipment by air at Airseaglobal Vietnam Joint Stock Company

3 Objects and scope of research

In chapter 1, the writer uses the method of conceptualization, analytical method,and systematization method to systematize and analyze some basic theories about the airfreight forwarding process; the process of freight forwarding by air and the necessity offreight forwarding activities in import and export activities and analysis of factorsaffecting freight forwarding activities.

In chapter 2, the writer uses analytical methods, statistical methods, andcomparative methods to analyze the actual situation in the process of delivery and receipt

of medical equipment by air at a joint stock company Airseaglobal Vietnam

In chapter 3, the writer uses analytical, synthesis, and systematization methods toprovide orientations, predict opportunities and challenges, and propose solutions to

improve the delivery process medical equipment goods by air at Airseaglobal VietnamJoint Stock Company in the near future

5 Structure of the research

Apart from the introduction, table of contents, list of references, the thesis is dividedinto three specific chapters as follows:

Chapter 1: Theoretical basis for import and export goods delivery by air

Chapter 2: Analysis of the reality of delivery and receipt of imported medical equipment at Airseaglobal Joint Stock Company

Chapter 3: Solutions to improve the quality of air freight service for medical

equipment import at Airseaglobal Vietnam Joint Stock Company

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Chapter 1: Theoretical basis for import and export goods delivery

by air1.1 Overview of import and export freight forwarding activities.

1.1.1 Some definitions and classification of freight forwarding services

1.1.1.1 Definitions

Import and Export1: Export of goods is the activity of selling goods to foreigncountries, it is not an act of individual sales, but an organized sales system of economicorganizations for the purpose of generating profits, promoting production, commodityproduction to develop, to transform the economic structure, to stabilize and graduallyraise the people's living standards Exporting is a business activity that can increase theincome of an enterprise in particular and of the entire economy in general.Commodityimportation is an international trading activity, which is the process of exchanging goodsbetween countries based on the principle of parity exchange for currency as a broker It isnot a single act of trade but a system of trade relations in an economy Thus, import andexport of goods is the purchase and sale of goods with foreign countries to developproduction and business life But trading here has its own complicated features such asdealing with people of different nationalities, a large market that is difficult to control,buying and selling through intermediaries accounts for a large proportion, payment inforeign currencies Goods transported across border gates and border gates of differentcountries must comply with international as well as local customs…

Delivery2: Freight forwarding are activities in the circulation and distribution stage,

an important stage connecting production and consumption, the two main sides of the socialreproduction cycle Freight forwarders perform the function of bringing products from theplace of production to the place of consumption, completing the second side of thedistribution and physical circulation, when the first side is the commercial procedure hasformed Forwarding is associated with and parallel with the transportation process Throughforwarding, transportation operations are carried out Collection of goods, transportation,loading and unloading, storage, transmission, packaging, procedures, documents With such

broad content, there are many definitions of forwarding and forwarding: According

1 http://hoixuatnhapkhau.com/xuat-nhap-khau-la-gi-nhung-dieu-can-biet-ve-xuat-nhap-khau/

2 https://goldensealogistics.com/van-chuyen-hang-hoa-la-gi-vai-tro-vi-tri-cua-van-chuyen.html

to the rules of the form of the Federation of International Freight Forwarders

Associations (FIATA) 3 , a forwarding service is defined as any type of service relating to

the transportation, consolidation, storage, handling, packaging or distribution of goods aswell as consulting services related to the above services including customs, financial,insurance, payment, income, documents related to goods

Commercial Law 2005 4 : Forwarding is a commercial activity, whereby a person

providing freight forwarding services, organizing transportation, storage and warehousing

is doing other related services to deliver goods to the recipient according to authorization

of the shipper, carrier or other forwarder Export of goods means that goods are taken out

of the territory of Vietnam or brought into a special area located in the territory ofVietnam which is considered a separate customs area according to the provisions of law.Import of goods means that goods are brought into the territory of Vietnam from abroad

or from a special area located in the territory of Vietnam which is considered a separatecustoms area according to the provisions of law So basically, freight forwarding is acollection of jobs related to the transportation process in order to move goods from the

place of shipment (Consolidator) to the place of receipt (Consignee).

1.1.1.2 The necessity of forwarding activities in import and export of goods

Forwarding activities are activities that play an important role in determining the completion of the import-export process Therefore, freight forwarding in general and delivery services in particular are of great significance To clarify this, I put forwarding

on two perspectives, namely the role of forwarder and the responsibility of forwarder in import and export of goods for analysis Forwarding activities develop in the direction ofinternational economic development, forwarders play the role of carriers, consolidators, agents and customs brokers

The development of production requires the corresponding development of

circulation and trade In which transportation and freight forwarding occupy a very

important position In the economy of every country or the global economy, air transport

3 https://fiata.com/news/2021/rules-and-procedures-for-stronger-fiata-regions.html

4 http://vcci-ip.com/wp-content/uploads/2017/06/commercial_law_year_of_2005.pdf

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is likened to a blood vessel for a living organism, creating the driving force for strong economic development Air transport compared to other modes is quite young, about a century old Especially after the 2nd world war, air transport has made great strides due tothe achievements of science and technology and began to be used for civilian purposes Inrecent years, air transport has developed very rapidly, especially in the Asia Pacific

region Although newly born, but air transport has developed very quickly due to the greatprogress of science and technology and the high-speed needs of human civilization Today, air transport has Boeing's 70-ton aircraft (B747-300)5 with a speed of 11,000 km/h(Boost Glide Vihichle - BGV) This plays an important role in establishing and

expanding many different economic zones, creating common development for the whole world Although carrying only 1% of the total volume of goods, it accounts for 20% of the value of goods in international trade With its own characteristics, air transport can be developed in economically developed areas with good infrastructure In the world today, airport clusters are concentrated mainly in North America, Europe, Northeast Asia, and recently there has been a remarkable development of Asia - Pacific countries Besides, almost all countries have their own airport clusters and are growing and developing constantly

1.1.1.3 Types of forwarding services 6

Air freight is one of the highly competitive forms of transportation in the field oflogistics today, using aircraft to transport goods Goods are carefully packed and loaded ontospecialized cargo planes or cargo cabins of passenger aircraft Along with the development ofthe economy, the open trade between countries, this form of transportation has become moreand more popular and dominant Compared with sea transport, air freight will be lesscommon because this type of freight is limited in terms of the type of goods as well as thevolume and size of the goods However, internationally, this is considered an

5 https://www.freightwaves.com/news/flashback-friday-the-history-of-air-freight

6 https://airspeed.ph/blog/popular-types-freight-forwarding-services/

attractive and potential market because of its very fast and safe delivery speed This form

of transportation brings a lot of advantages, but there are still many disadvantages:

Pros: Airmail makes it easy to ship goods abroad The problem of collision is also

rare because the accident rate is very low, ensuring the safety of goods better

Cons: Although this form is very effective, it is only used to transport personal

goods, simple and light With bulky goods, very few options are available because thetransportation costs are quite high The volume of goods is also limited and customsprocedures when transporting goods are also quite complicated and time consuming

Sea transport is a form of freight transport using means of transport and seainfrastructure to serve the purpose of transportation Commonly used means will be boatsand means of loading and unloading goods such as cranes Infrastructure to serve seatransport includes seaports and transshipment ports Sea transport is suitable for areaswith adjacent waters and ports for ships to dock Shipping can be done by sea freightdomestically or internationally Because shipping vessels are often large in size andtonnage, usually sea transport is widely applied to the import and export industry to carrylarge quantities of goods

Pros: Sea freight is used to transport long-term goods, especially international

shipments Transport routes are more comfortable and open than road transport Cantransport many goods with large volume and size The cost of transporting goods is nottoo high compared to road transport, so in cities with seaports, this mode of sea transport

is often used

Cons: If transported by ship, it is not possible to deliver goods to the place, but

must dock at ports and transfer by car to the mainland Because of sea operations, theshipping time is slow and depends a lot on weather factors Besides, the goods are easilyaffected by each other if there is an incident on the ship during transportation

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Road transport is the most common and popular form of transport in all modes oftransport Jute is a method of transporting goods by means of transport on the road such

as cars, passenger cars, trucks, tank trucks, container trucks, trailers, semi-trailers towingcars small scale and domestic, usually between provinces and localities in the country

Pros: Road transport mainly uses motorbikes and trucks, so it is very flexible in

the process of transporting goods, does not depend on time and does not have a specifictime, but only the parties Self-unified time as well as may change during transportation.Choosing the own means of vehicle, quantity of goods or route as required Therefore,this method helps to save costs and labor, except in the case of long-distancetransportation, which may incur additional costs

Cons: long-distance transportation often has to pay additional road surcharges: toll

stations, fuel fees, tolls Road transport also contains many risks such as trafficaccidents, traffic jams, etc Great influence on goods and delivery time The volume ofgoods transported is also much more limited than by waterways and railways

1.1.2 Forwarders and freight forwarding organizations.

1.1.2.1 Definition 7

According to FIATA, the forwarder is the person who takes care of the goods

transported under the trust contract and acts in the trustee's interest The forwarder alsoensures to undertake all work related to the delivery contract such as preservation, transitstorage, customs clearance, inspection

The forwarder can be the owner of the goods (when the goods owner himself takesover the work of delivering and receiving his goods), the ship owner (when the ship ownerperforms the forwarding service on behalf of the goods owner), the loading and unloadingcompany or warehouse, professional forwarder or any other person who has registered forfreight forwarding service business Forwarders with qualifications such as: (i) Know how tocombine many modes of transport together; (ii) Know how to maximize the capacity and

7 Phạm Mạnh Hiền (2012), “Nghiệp vụ giao nhận vận tải và bảo hiểm trong ngoại thương”, NXB Lao động – xã hội

tonnage of transport tools thanks to the delivery service; (iii) Know the combination oftransport - forwarding - import and export and have good contact with organizations related

to the process of transporting goods such as customs, shipping agents, insurance, ports …;(iv) Forwarders also create favorable conditions for import and export business to operateeffectively thanks to their forwarding services Thus, the importer and exporter can use thewarehouse of the forwarder or the hired forwarder, thereby reducing warehousing costs.Besides, it also reduces costs such as financial management, simple organizational structure,and conditions to focus on import and export business

1.1.2.2 Rights and obligations of the forwarder:

Article 167 of the Commercial Law stipulates that the forwarder has the followingrights and obligations: The forwarder is entitled to remuneration and other reasonableincome; Fully perform your obligations under the contract; In the course of contractperformance, if there is a legitimate reason for the benefit of the customer, it can be donedifferently from the instructions of the customer, but must immediately notify thecustomer; After signing the contract, if it is found that it is impossible to carry out theinstructions of the customer, it must notify the customer for further instructions; Having

to perform its obligations within a reasonable time if the contract does not agree on thetime to perform obligations with the customer

1.1.2.3 Responsibilities of the forwarder

Agents of the owner: Depending on the functions of the forwarder, the forwarder

must fulfill his obligations under the signed contract and be responsible for: Delivery notaccording to instructions; Failure to buy insurance for goods despite having instructions;Shortcomings while doing customs procedures; Carrying goods to the wrong place;Deliver goods to people who are not recipients; Delivery without collecting money fromthe consignee; Re-export does not follow necessary procedures or does not refund tax;Damages to property and people of a third party that he causes However, the forwarder isnot responsible for the fault of a third party such as a carrier or another forwarder Whenacting as an agent, the forwarder must comply with their "Standard Trading Conditions"

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The carrier: As a carrier, the forwarder acts as an independent contractor,

responsible for providing the services requested by the customer on his behalf:

Firstly, the caririers shall be liable for the acts and omissions of the carrier, of the otherforwarder he hires to perform the contract of carriage as if his own acts and omissions

Secondly, their rights, obligations and responsibilities are determined by the laws ofthe modes of transport The carrier collects from the customer the price of the service heprovides, not a commission

The forwarders act as carriers not only in case they carry the goods themself by theiown means of transport (perfoming carrier) but also where they, by issuing transportdocuments, act as a carrier Their own load or otherwise, undertakes to assume theresponsibility of the carrier (contracting carrier) When the forwarders provide servicesrelated to transportation such as packing, storage, loading or distribution , the forwarderswill be responsible as the carriers if the forwarders perform the the above service by theirown vehicle or the forwarders has committed, expressly or impliedly, that they areresponsible as carriers When acting as a carrier, standard business conditions usually donot apply, but international conventions or rules issued by the International Chamber ofCommerce However, the forwarder is not responsible for the loss or damage of the goodsarising from the following cases: (i) Due to the fault of the customer or the personentrusted by the customer; (ii) The customer does not properly pack and sign the code;(iii) Due to internal organs or the nature of the goods; (iv) Due to war, strike; (v) Due toforce majeure circumstances In addition, the forwarder is not responsible for loss ofprofits due to delay or delivery to the wrong address through no fault of his own

1.1.3 Legal basis - principles of freight forwarding in air transport

The delivery and receipt of import and export goods must be based on a legal basissuch as international and Vietnamese legal norms such as international legal norms(conventions on bills of lading, transport; conventions on international goods sale andpurchase contracts …), legal documents of the Vietnamese state on freight forwarding,

different types of contracts and L/Cs, etc., to ensure the interests of import and export goods owners.Legal regulations can be listed as:

• The 1980 Vienna Convention on International Trade

• International treaties on air transport

• Warsaw Convention 1929

International air transport is governed primarily by the International Convention forthe Unification of Certain Rules of International Carriage by Air signed in Warsaw on 12October 1929 referred to as the Warsaw Convention 1929 Protocol to amend the WarsawConvention: This protocol was signed at The Hague on September 28, 1955, so it is calledthe Hague Protocol 1955 for short The Covenant to the Warsaw Convention was signed

at Guadalazala on September 18, 1961, so referred to as the 1961 GuadalazalaConvention Agreement concerning the limitations of the Warsaw Convention and theHague Protocol This Agreement was adopted in Montreal May 13, 1966, so it is calledthe Montreal Agreement 1966 Protocol Amending the Warsaw Convention 12 October

1929 as amended by the Hague Protocol 28 September 1995 This Decree was signed inGuatemala City on March 8, 1971, so it is called the Guatemala Protocol 1971

✓ Additional Protocol No.1: Protocol Amending the Warsaw Convention 1929 ThisProtocol was concluded in Montreal on September 25, 1975, so it is referred to as theMontreal Protocol 1975 No.1

✓ Additional Protocol No.2: The Protocol Amending the Warsaw Convention of

1929 was amended by the 1955 Hague Protocol This Protocol was signed in Montreal onSeptember 25, 1975, so it is referred to as the 1975 Montreal Protocol, version number 2

✓ Additional Protocol No.3: The Protocol Amending the Warsaw Convention of 12October 1929 was amended by the protocols at The Hague on September 28, 1955 and atGuatemala City on March 8, 1971 This Protocol was signed in Montreal on September 25,

1975, so it is called the Montreal Protocol of 1975, version 3

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✓ Additional Protocol No.4: Protocol to amend the Warsaw Convention of October

12, 1929, was amended by the Hague Protocol of September 28, 1955 This Protocol wassigned in Montreal, so it is referred to as the Montreal Protocol of 1975, version 4

The Government of Vietnam has also issued many legal documents related to

transportation, loading and unloading, delivery of import and export goods such as: Law on Civil Aviation 201; The laws of import and export; Commercial Law 2005; Decree 140/2007/ND-CP dated September 5, 2007 detailing the commercial law on conditions for logistics service business and limitation of liability for traders providing logistics services.

1.1.3.2 Principles of delivery:

Current documents stipulate the principles of import and export goods delivery asfollows: (i) The delivery and receipt of exported goods at the port (airport) is carried out bythe port on the basis of a contract between the goods owner or the person entrusted by thegoods owner with the port; (ii) In case the goods do not pass through the port (not stored atthe port), the goods owner or the person entrusted by the goods owner can deliver and receivethe goods directly with the carrier In this case, the goods owner must settle with the airline,only agree with the airport on the location of loading and unloading, pay the unloading andother costs incurred; (iii) The loading and unloading of goods within the airport is responsiblefor the airline; (iv) The consignee must present valid documents confirming the right toreceive the goods and must receive continuously within a specified time the volume of goodsstated in the documents; (v) The airline is not responsible for the goods when the goods leavethe warehouse or the airport; (vi) How to deliver and receive like that, pay attention to thecontent and delivery method for each item Must agree on both the delivery and receipt of theunit of account, the terms of loss and damage, if any

1.2 Professional process of forwarding and receiving goods imported by air

1.2.1 The process of receiving imported goods by air

The process of receiving imported goods by air is shown in the diagram below:

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Buyer and seller The goods owner The forwarder

sign foreign trade

contract

Delivery to the

airport

Figure 1 1: Import and export freight forwarding process

Step 1: Buyer and seller sign foreign trade contract

The first step to start the import is to negotiate and sign a sales contract between

the shippers This is an agreement between the two parties on the purchase and sale of the

shipment, and should include the necessary contents Detailed content is negotiated and

agreed by the two parties to suit actual needs When a contract is signed, it is necessary to

include all terms such as warranties, complaints, in order to ensure the interests of the

parties, if not, when unfortunately there is a problem of poor quality goods , or if there is

a dispute, there is no basis to work with the seller

Step 2: The shipper signs a service contract with the forwarder

After signing a foreign trade contract, the seller or the buyer (depending on the

conditions) will hire a shipping company to do the necessary steps in the door-to-door

delivery process Shipping company (carrier) or forwarder company or air agent (GSA)

This forwarder must be designated by the airline and authorized to operate cargo for the

airline The contract of carriage between the shipper and the forwarder must contain the

following information:

• Consignor and consignee information

• Description of goods: type, weight, quantity, volume

• Departure airport name, arrival airport name

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• Fees and payments

Step 3: The forwarder receives the papers and documents

After signing the service contract, the seller or the buyer will send documents related to the shipment to the forwarder including:

• Sale contract

• Commercial Invoice (Commercial Invoice)

• Packing List (Packing List)

• Certificate of Origin (Certificate of Origin)

• Letter of introduction, authorization of the consignee

• For medical equipment goods will need to add:

30/2015/TT-• Air waybill (Master bill) when the goods are about to be loaded on the plane

• Arrival Notice when the goods are about to arrive at the airport of import

Step 4: Do import customs procedures

Along with the above documents, the forwarder will carry out customs proceduresfor export goods When doing customs procedures, the declarant performs the followingbasic steps:

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Document officerdeclares and submitscustoms declaration

Get threadingresults

Green stream Golden stream

Customs checksgoods documents

Red stream

Customs physicalinspection ofgoods

Tax payment and customs clearance

Figure 1 2: Steps to do customs procedures

When doing customs procedures, the forwarder will have to make a declaration tosubmit to the customs The customs declaration is made according to the prescribed form.Previously handwritten according to pre-printed form Now, most of the Sub-Departmentshave switched to declaring and submitting declarations in the form of electronic customsusing specialized software

After submitting the customs declaration, there will be 3 cases:

In this case, the enterprise complies with the state's laws on customs Theenterprise is exempted from detailed inspection of documents and from detailedinspection of the enterprise's goods

Customs will check the documents of the goods, if deemed appropriate, they willconduct customs clearance of the goods, the forwarder needs to present to the customs thedocuments including:

• Customs declaration (printed from software, no stamp required)

• Commercial invoice (signature, round seal + title)

• Other documents: Bill of lading, C/O, quality inspection paper (specialized

inspection)

The actual goods must be inspected after completing the inspection of the paperdocuments This is the highest level of inspection, which requires a lot of procedures and isthe most costly, time-consuming and laborious for both goods owners and customs officers.First of all, people doing customs procedures still have to have a set of documents like theabove golden stream After the customs receives and approves the dossier, it will betransferred to the inspection team The customs clearance person registers the goodsinspection, goes to the port to carry out the procedures for unloading the goods to theinspection area, and then contacts the customs officer to come down to carry out inspectionprocedures Currently, there are two forms of inspection: inspection by scanners (scanners),and manual inspection After the inspection is completed, the customs officer will return tothe branch to carry out the necessary procedures: Inspection record If it is ok, we will do theprocedure to decide & peel the declaration and finish the part at the branch The customsclearance person prints the bar code of the customs declaration, and when he arrives at theport to complete the procedures for changing orders and signing for customs supervision(also known as signing the yard gate), he can pay taxes and clear the goods

Step 5: Receive goods at the airport:

After the goods are cleared, the forwarder holds the customs clearance declaration andthe letter of introduction and authorization of the recipient to the warehouse to receive thegoods When receiving goods, they must check the goods, if there is damage or

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breakage, they must make a record of identification, certified by the warehouse for futurecomplaints.

Step 6: Deliver the goods to the recipient's warehouse

According to the signed service contract, the forwarder will transport the goodsfrom the airport to the recipient's warehouse as required After successfully delivering thegoods, the forwarder makes a payment and returns all documents of the shipment to therecipient, ending the process of receiving imported goods

1.2.2 Duties of agencies participating in import and export goods delivery

1.2.2.1 Duties of the airport

Sign the contract of loading, unloading, delivery, preservation and storage of goodswith the goods owner Delivering exports onto the plane and receiving imports from theaircraft, if authorized Make an accounting with the airline on the delivery and receipt ofgoods and make other necessary documents to protect the interests of the goods owners.Delivery of imported goods to domestic goods owners under the entrustment of foreigngoods owners Carrying out loading and unloading, transportation, preservation andstorage in the port area

Be responsible for the loss of goods caused by you during the delivery, transportation,loading and unloading If goods stored in the port's warehouse are damaged or lost, the portmust compensate if there is a valid record and if the port cannot prove that the port is not atfault The port is not responsible for the goods in the following cases: Not responsible for thegoods when the goods have left the port's warehouse; Not responsible for the goods inside ifthe package, the seal is still intact; Not responsible for damage caused by incorrect orunknown product codes (leading to loss or confusion)

Issuing bills of lading and delivery notices to recipients

Transport the goods to the right airport and on time as shown in the bill of lading.Warehousing of goods upon arrival at the import airport

1.2.2.3 Duties of shippers (exporters, importers or their trustees)

(i) Sign a forwarding and consignment contract with the port in case the goods pass through the port

(ii) Carrying out freight forwarding with the airline in case the goods do not passthrough the port or carrying out the delivery of import and export goods with the port in thecase of goods passing through the port

(iii) Sign a contract for loading, unloading, transporting, preserving and storing goods with the airport

(iv) Provide the airport with cargo and flight information

(v) Provide necessary documents to the port for the port to deliver goods

(vi) Follow up the delivery process to solve arising problems

(vii) Prepare necessary documents in the delivery and receipt process to have a basis for complaints about related parties

(viii) Payment of port charges

Proforma Invoice: This is the document issued by the seller when the seller needs to

issue to the buyer a shipment document, at which point the goods have not been delivered

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(or are not ready) and needs a shipment confirmation document for export customsclearance (in some countries) This is just an initial draft of the official commercialinvoice Based on that, buyers and sellers know basic information about the shipment,including type, model, quantity, unit price, total amount, and delivery conditions.

Letter of Credit (L/C): L/C is issued by a financial institution or financial

intermediary to sellers and buyers to create peace of mind for the buyer and seller in thetransaction when the buyer will be afraid that if payment is made in advance, the sellermay not deliver the goods as requested or the seller will be afraid If the goods areshipped in advance, the buyer may not pay properly and in full

Insurance Certificate: Insurance document is issued by an insurance carrier for a

shipment to create peace of mind for shippers when transporting goods

Certificate of Origin (C/O): C/O is a document showing the origin of goods

produced in which territory or nation and is issued by the competent authority of theexporting country for exported goods manufactured in that country to help importersenjoy special preferential tax, or tax reduction C/O consists of 2 main types: “Non-preferential C/O”: is a normal C/O, it confirms that the origin of a particular product isfrom a certain country and “Preferential C/O”: is a CO that allows products to be reduced

or tax-free to countries that extend this privilege For example: Generalized tariffpreferences (GSP); Commonwealth Preference Certificate (CPC); Common EffectivePreferential Tariff (CEPT);…

Phytosanitary Certificate: Quarantine certificate is issued by the quarantine

authority (animal or plant) for the consignment to prevent the spread of disease betweencountries and territories

1.2.3.3 Documents used for imported goods

Authorization letter of introduction is issued by the buyer to the forwarder to grant

the right to the forwarder to carry out the procedures related to the goods and take thegoods out of the warehouse

Delivery orders (D/O) are divided into 2 types: Firstly, Forwarder's D/O: The

shipping agent's delivery order simply means that the shipping agent issues this order torequire the goods holder to deliver the goods to the buyer However, the shipping agent isnot the person who writes the Bill, so you cannot use this order only to receive the goods,but you require the accompanying documents Secondly, D/O of shipping line/airline:Shipping order of shipping line/airline is an order issued by the carrier to request theperson holding the goods to deliver the goods to someone Usually the relationship willbe: The shipping line requests delivery to the forwarder and the forwarder requestsdelivery to them When the forwarder holds the D/O that the shipping line/airline hasissued to him and returns it to the importer along with the original Bill of the shippingline, the importer is eligible to receive the goods

Arrival notice is issued by the shipping line / airline to the forwarder or the buyer

(when the buyer is the person who directly book the ship / plane) to help buyers determinethe time their goods arrive at the port / airport and are necessary documents for customsdeclaration

1.3 The criteria for evaluating the results of business activities of import and

export freight forwarding services

1.3.1 Business evaluation criteria

1.3.1.1 Revenue, Profit - Revenue growth rate

A business's revenue is the entire amount that will be earned from the sale of products,provision of services, financial operations and other activities of the business In economics,revenue is usually determined by selling price times output This indicator allows enterprises

to directly compare the competitiveness of their enterprises with other enterprises in order toevaluate the results of their production and business activities Enterprises have high turnovercompared to competitors in business activities, which shows that a business has good andstable operation If the above criterion forces the enterprise to fully investigate the market ofcompetitors of the same product, then this criterion allows the enterprise to choose thestrongest or most suitable competitor in terms of production

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process, structural model, compare, draw strengths and shortcomings to overcome in thecoming time This indicator is simpler and easier to calculate, the market shares held bystrong enterprises are often highly profitable and most likely businesses need to dominatethis market area This is also an opportunity for businesses to learn more about keycompetitors.

Profit is the highest economic goal, a condition for the existence and development

of enterprises This is a composite indicator that reflects the entire result and efficiency ofthe production and business process from the time of searching for market demand,preparation and production and business process until the organization is organized salesand service to the market It reflects both the quality and quantity of business competition

If this indicator is low, the level of competition in the market is very fierce, there are toomany enterprises in this market and enterprises must constantly improve theircompetitiveness in order to improve their profit margins On the other hand, if thisindicator is high, the competitiveness of the enterprise is strong Enterprises can takeadvantage of this advantage and constantly watch out for competitors who can enter themarket at any time due to the attraction of high profits

➢ Revenue growth rate

Revenue growth is the goal that all businesses today set and aim for The revenuegrowth rate is the percentage change in a business's revenue over a specific period of timeand given in a given context The rate of growth depends on two processes: theaccumulation of assets such as capital, labor, and facilities and the investment of moreproductive assets Although saving and investment are both central to growth, investmentmust be effective to boost revenue growth.The growth rate of the business shows thefuture development prospects of the business The fluctuation in sustainable growth ratenot only reflects the change in the scale of operating results, but also reflects the stability,development situation and solid development level of the enterprise Sustainable revenuegrowth rate of enterprises depends mainly on revenue growth rate and profit growth rate

✓ Net sales growth rate

Net revenue growth rate reflects the increase in net revenue of a business over time

is high or low

Figure 1 3: Method of net sales growth rate

By looking at the variation over time in the growth rate of net sales, the user of theinformation can assess the stability of the size and market of consumption, the state of thebusiness (favorable, difficulties), business scale (expansion, income) as well as thedevelopment trend of the business

✓ Profit growth rate:

Figure 1 4: Method of Profit growth rate

Profit growth rate reflects the increase in profits over time By looking at the profitgrowth rate, information users can recognize the quality of business activities, quality ofcost management, current business status, etc of the enterprise

Service quality is customer satisfaction when service providers meet customer needs.Customer satisfaction with a service is determined through a comparison between 22

the expected service and the service perceived by the customer Service quality isevaluated based on a number of criteria such as:

Tangible: is the company's facilities, equipment, employees, and means of

transportation

Timeliness: ensuring that raw materials and goods are supplied in a timely manner.

Flexibility: refers to the ability of the company to coordinate resources to meet the

special requirements of customers

Level of safety and accuracy: the ability to ensure customer safety, expressed

through physical, financial, and information security

Reliability level: is the trust and reputation of the service and the business to

customers

Enterprises providing freight forwarding services by air always have an Agentdepartment to contact foreign agents so that they can look up international shipping pricesaccurately, ensure balance and delivery in accordance with the requirements, providingcustomers with the highest quality and most convenient service In most countries,businesses providing forwarding services build agency relationships to ensure the mostconvenient and effective delivery and delivery.…

Market Share is the share of sales that a certain business has captured in a givenmarket Market share is used to measure the concentration of sellers in a market Whenyou know how much market share the business holds, locate where the business isstanding in the market, is the business line saturated, is there still room for growth, at thispoint the business can decide whether to continue trying to dominate the market orwithdraw from this market And one of the methods to properly assess their growthmarket share, businesses often use the Boston Matrix

1.3.1.4 The level and speed of business growth

In order to accurately assess the level of development of an enterprise, we need torely on different level factors to determine the growth rate of an enterprise depending onits business type For large forwarding companies in Vietnam, freight activities need tohave a strict and disciplined working process and are divided into different levels,including 4 main levels:

✓ Level 1: traditional forwarding agents only provide services requested bycustomers such as transporting goods by road, performing customs procedures on behalf ofgoods owners, making documents, storing and storing goods , delivery

✓ Level 2: forwarding agents act as consolidators and issue home bills of lading Theoperating principle of these companies is to have exclusive agents at major ports to carry outthe withdrawal/packing of import and export goods

✓ Level 3: Forwarding agent acts as multimodal carrier In this role, some companieshave coordinated with the foreign company at the port of discharge with a sub-contract toautomatically arrange the transportation of goods to the final destination according to thebill of lading

✓ Level 4: this is a forwarding agent that becomes a logistics service provider This

is the inevitable result of the integration process

1.3.2 Business performance metrics

1.3.2.1 ROA – ROE Coefficient

ROA (Return of Assets) - known as the return on assets ratio, is an indicator thatshows the correlation between a company's profitability compared to its assets ROA willtell us the efficiency of the company in using assets to make a profit

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Figure 1 5: Method of ROA

ROA shows the efficiency of using assets of the Enterprise The higher the ROA,the better the asset utilization of the Enterprise ROA for joint stock companies variesgreatly and depends on the industry That's why it's a good idea to compare ROA betweensimilar companies, and when assessing ROA each company should not consider a singleyear but should be many years, at least 3 years Investors should also pay attention to theinterest rate the company pays on its debt If a company doesn't earn more than it spends

on investing activities, that's not a good sign Conversely, if the ROA is better than thecost of borrowing, it means the company is pocketing a bargain

ROE (Return of Equity) - Return on equity is an indicator that measures theefficiency of the use of equity in a business

Figure 1 6: Method of ROE

The ROE ratio reflects both profitability, which is shown on the income statement,and average equity, on the balance sheet The higher the ROE ratio, the more effectivelythe company uses shareholders' capital, which means that the company has harmoniouslybalanced between shareholder capital and borrowed capital to exploit its competitive

advantage in the future Capital raising process, scale expansion Therefore, the higher theROE ratio, the more attractive the stocks are to investors.

1.3.2.2 Customer satisfaction

This is one of the indicators used to evaluate business performance that anybusiness should focus on Because the products/services provided by enterprises canproperly and sufficiently meet the needs of customers and make them satisfied, then thoseproducts/services have a great chance to continue being provided in the coming years.The next year Moreover, if you focus on customer satisfaction, it will help businesses get

a source of loyal customers, thereby increasing profits for businesses without having tohave a headache to find new customers Therefore, in the process of doing business,businesses should listen to customer feedback about their products/services From there, it

is possible to make appropriate adjustments

Maintaining the number of old customers to ensure that the profit of the businessdoes not decrease, but if you want to increase profits, you need to have a marketingstrategy to attract new customers Enterprises can completely know the averageweek/month/year how many new customers their business has, by controlling the list ofold customers The number of customers who are not on the list of old customers is thenumber of new customers that businesses can reach

1.4 Factors affecting business activities of freight forwarding services by air

Human resources are a decisive factor in production and business efficiency, therebyaffecting the competitiveness of enterprises Human factor is considered an extremelyvaluable asset for the successful development of each country and each enterprise With agood and uniform team of human resources, businesses can do well with the plans and goalsthey have set A team of experienced, highly qualified, dynamic, flexible and

knowledgeable leaders and managers will bring businesses not only immediate benefits 26

such as increased revenue, increased profits but also corporate reputation They will come

up with many creative strategic ideas that are suitable for the development and maturity ofthe business as well as the changes of the market

1.4.1.2 Infrastructures

Enterprises doing business in freight forwarding services by air will have thefacilities, equipment and infrastructure to serve their service provision The forwarder'sinfrastructure and equipment includes department offices, warehouses, transportationfacilities, loading and unloading facilities, storage and storage of goods, etc Toparticipate In the modern delivery and delivery activities like today, forwarding servicebusinesses must invest in a modern and suitable infrastructure to serve the activities ofconsolidating, loading, unloading and loading goods and inspect the goods The strongdevelopment of technology helps the forwarder manage all business activities andimportant information of customers through the electronic data transmission system.Besides, the convenient road infrastructure system facilitates the fast transportation ofgoods, ensuring the safety of goods when they arrive at the importer's warehouse Theinvestment in modern machinery is also an important factor, with specific items requiringspecialized machinery is necessary Therefore, factors related to infrastructure, equipmentand machinery are very necessary and important for businesses providing import andexport freight forwarding services in general and freight forwarding in particular

Investment capital plays a role in import and export freight forwarding activities ingeneral and air freight forwarding in particular When the amount of investment capital is notenough, the facilities - infrastructure - machines are not improved, leading to the delivery andreceipt of goods being interrupted, delaying the progress of the process and affecting theperformance of the operation itself On the contrary, if there is an abundant amount ofinvestment capital, the infrastructure, machinery and equipment are upgraded to be moremodern, the free delivery and delivery process can be done quickly, efficiently andefficiently The yield can exceed 100% However, the financial resources of the forwardingservice business are not always abundant, so when calculating the investment in the system

in the forwarding process, it is necessary to clearly define and carefully calculate the 27

investment to get the most out of it Businesses can also consider outsourcing or linkingwith transporters in some cases to reduce delivery costs.

1.4.2 External Business Factors

Every business operating in any field is subject to the impact of the surroundingenvironment and the impact of the business itself Therefore, the development ability of

an enterprise depends not only on the business itself but also on other objective factors ofthe environment surrounding the business External factors are where the business isoperating and have a direct influence on the policies, determining the development ability

of the business

This is a very important factor that attracts the attention of all businesses Theimpact of these environmental factors is more direct and dynamic than some of the otherelements of the general environment The developments of the economic environmentalways contain different opportunities and threats for each enterprise in differentindustries and have potential influence on the business strategies of enterprises Agrowing economy will bring momentum for all businesses With economic development,population demand increases, domestic and foreign investment attractiveness will alsoincrease, the competition will also become increasingly fierce On the contrary, when theeconomy is in recession and instability, people's purchasing power will decrease.Enterprise services provided to the market will slow down, profits will decrease,companies will have to find ways to retain customers and market competition becomesmore and more fierce The economic environment is the environment that has a profoundinfluence on the competitive policies and decisions of enterprises

1.4.2.2 International trade agreements

In the process of doing business in logistics services, international customs must beobserved, for example, terms of receipt of goods (Incoterms); Rules for implementingdocumentary credits; Cargo insurance during transportation, loading and unloading, storage,receiving Vietnam is a member of ASEAN, so Logistics services are also affected

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by regional agreements such as: 1999 GMS-CBT Agreement; Facilitation of goods in transit (1968); Agreement on multimodal transport framework SEEN 2005.

Table 1 1: The legal system governing air freight forwarding and forwarding services

81/2014/TT-Vietnam 2006; business and aviation transportation and

activities general aviation

activities;

Aviation Law the Government on 43/2017/QD-TTG on

operation of airports responsibilities forand airfields carrying out

procedures for aircraft

on exit, entry andtransit through thenational singlewindow mechanism

Source: Law Library (author's own compilation)

Politics and law have a great impact on the development of any business, especiallyinternational businesses Politics and law are the foundation for economic development aswell as the legal basis for enterprises to do business in any market, whether domestic orforeign A stable economy requires stable politics and laws Policies as well as legal

documents will directly adjust to economic policies, thus affecting business activities.Especially in countries with political instability, the risk of damage to companies withinternational trade activities is greater Clear laws, stable politics is a favorable environmentfor business activities of each enterprise In international forwarding activities in general andfreight forwarding by air in particular, not only creates favorable conditions for that country'sdevelopment, but also is one of the factors for strong trade in goods.

Includes norms and values that are accepted and respected by a particular society orculture The change of socio-cultural factors is partly a consequence of the effects of othermacro factors, so it usually happens more slowly than other factors Some of thecharacteristics that businesses need to pay attention to is that the impact of socio-culturalfactors is often longer-term and more subtle than other factors, sometimes even difficult toperceive On the other hand, the range of influence of sociocultural factors is often very wide:

"it determines how people live, work, produce, and consume products and services" Thus,cultural and social understandings will be very important bases for businesses in the process

of building business strategies Aspects that form the socio-cultural environment have astrong influence on business activities such as: conceptions of morality, aesthetics, lifestyle,and profession; customs, practices and traditions; the concerns and priorities of society; thegeneral level of awareness and education of the society

1.4.2.5 Natural factor

The natural environment greatly affects the delivery, receipt and transportation ofgoods by air This is considered a force majeure condition that occurs during the delivery andreceipt of goods, affecting the making and speed of delivery The influence of bad weatherduring air travel will cause the goods to be affected in terms of goods’s quality and it is thecause of disputes between forwarders and import later Therefore, grasping the naturalsituation to be able to avoid and negotiate with customers will be a way for the two sides tosupport each other and help the air freight forwarding process to be more complete

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on paper as before The development of a new all-natural fuel system reduces the harmcaused to the environment, reduces air pollution, and noise pollution The increasinglymodern, high-capacity aircraft manufacturing technology has improved the efficiency ofthe entire process, creating a new step forward in air transport.

Chapter 2: Analysis of the reality of delivery and receipt of imported medical equipment by air at Airseaglobal Joint Stock Company

2.1 Current status of medical equipment delivery at Airseaglobal Joint Stock

Company

2.1.1 Overview of Airseaglobal Joint Stock Company.

2.1.1.1 Introduce about the company

- Company Mame: AIRSEАGLОBАL VIETNAMGLОBАL VIETNAMBАGLОBАL VIETNAML VIETNAM

JOINT STOCK COMPANY

- Trading name: VIET NАGLОBАL VIETNAMM АGLОBАL VIETNAMIRSEАGLОBАL VIETNAMGLОBАL VIETNAMBАGLОBАL VIETNAML

JОBАL VIETNAMINT STОBАL VIETNAMCK CОBАL VIETNAMMРАGLОBАL VIETNAMNY

- Abbreviated Company Name: АGLОBАL VIETNAMIRSEАGLОBАL VIETNAMGLОBАL VIETNAMBАGLОBАL VIETNAML., JSC

- Tax code: 0105308539

- Type of company: Joint Stock Company

- Head office: АGLОBАL VIETNAM9/4 Center of Dia Chat Mine, Co Nhue 2 Ward, Bac Tu Liem

District, Hanoi, Vietnam

- Business Office: Р2412, Eurowindow Tower, 27 Tran Duy Hung, Trung Hoa Ward,

Cau Giay District, Hanoi

- Field of activity: is a business unit in the field of logistics.

- Line of business: Other supporting service activities related to transportation

Airseaglobal Vietnam Joint Stock Company was established under the Business Lawand was granted the Business Registration Certificate No The type is Company Limited.After many years of operation, on March 5, 2019, the Company registered to change thetype of Company into a Joint Stock Company The development of Airseaglobal can bedivided into three phases:

Stage 1: The first period (2011-2012): When newly established, Airseaglobal Joint

Stock Company operated with only 4 employees doing customs work and picking upgoods at Noi Bai airport and delivering them to the car for transportation to thewarehouse This is a difficult period because the Company has to face strong competitors

in the general difficult period of the economy At this time, the company's maincustomers are small businesses located in Hanoi city

Stage 2: Adapting to the market (2013-2014): From the end of 2012 to early 2013,

Airseaglobal Joint Stock Company expanded its operation area and business scope toprovinces and cities across the country At the same time, Airseaglobal hires more humanresources to meet the Company's business goals At this time, the company has a number

of large and potential customers such as: Sumitomo Electric Interconnect Products Co.,Ltd., Nam Ha Pharmaceutical Joint Stock Company, Ricoh Vietnam Co., Ltd …

Stage 3: Development stage (2015- now): After 6 years of operation, the Company

has finally found its own niche market, which contributes to reducing competitivepressure when there are many other large and small companies doing business in freightforwarding services Imported as Airseaglobal At the same time, during this period, thecompany also cooperates with many major transport agents around the world to help getgood input freight rates to sell to customers At the beginning of 2018, Airseaglobal JointStock Company was officially a member of the World Cargo Alliance (WCA), whichhelps the company increase trust with customers, enhancing its position in the world,position of the company Currently, Airseaglobal ranks No 1 in customs declaration ofmedical equipment and in the Top 3 in customs declaration of air cargo entering Noi Bai

2.1.2 Organizational apparatus of the company: