Recommendations to improve the freight forwarding services for importing FCL cargoes at GOODTRANS – haiphong

MINISTRY OF TRANSPORTATION

MINISTRY OF EDUCATION & TRAINING

VIETNAM MARITIME UNIVERSITY

STUDENT NAME: NGUYỄN THỊ THU HẰNG

DISSERTATION
GLOBAL STUDIES AND MARITIME AFFAIRS

RECOMMENDATIONS TO IMPROVE THE FREIGHT
FORWARDING SERVICES FOR IMPORTING FCL CARGOES
AT GOODTRANS – HAIPHONG

HAI PHONG – 2015


MINISTRY OF TRANSPORTATION

MINISTRY OF EDUCATION & TRAINING

VIETNAM MARITIME UNIVERSITY

STUDENT NAME: NGUYỄN THỊ THU HẰNG
CLASS

: GMA02

DISSERTATION
GLOBAL STUDIES AND MARITIME AFFAIRS

RECOMMENDATIONS TO IMPROVE THE FREIGHT
FORWARDING SERVICES FOR IMPORTING FCL CARGOES
AT GOODTRANS – HAIPHONG

Supervisor:

Mr. Doan Trong Hieu

Division:

Economics of International Trade

Faculty:

Faculty of Economics

HAI PHONG – 2015


Recommendations to improve the freight forwarding services for importing
FCL cargoes at GOODTRANS – Haiphong

PREFACE
This dissertation is a description of my 2-month-internship which occurs from
15th August to 15th October in 2015. During this period, I have chance to work in a
logistic company named GOODTRANS overseas services Co.,Ltd. The works in here
help me enhance my knowledge about freight forwarding services in general and
importing services for FCL cargoes in particular. Moreover, this is an opportunity for
me to take part in professional working environment.

My topic is “Recommendations to improve the freight forwarding services for
importing FCL cargoes at GOODTRANS – Haiphong” including three major
chapters.
I declare that this report is my own unaided work. It has not been
submitted before. If violated, I am solely responsible for and bear the punishments of
the Institution and University.

Student Name and Signature

Nguyễn Thị Thu Hằng

Nguyễn Thị Thu Hằng – GMA02

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ACKNOWLEGEMENT
I would like to express my sincere gratitude to my advisor Mr. Doan Trong
Hieu for the continuous support of my study and related research, for his patience,
motivation, and immense knowledge. His guidance helped me in all the time of
research and writing of this thesis. I could not have imagined having a better advisor
and mentor for my study.
In addition, I am also very grateful to Mr. Nguyen Manh Cuong - Chief of
Representative Office in Haiphong, who always guides, encourages and supports me
when I have internship in company. Last but not least, I am very appreciate and would
like to thank all the GOODTRANS staffs who help me complete all of works.

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TABLE OF CONTENTS
Preface......................................................................................................................... i
Acknowledge ............................................................................................................. ii
Table of Contents ...................................................................................................... iii
List of Symbols & Abbreviations............................................................................... vi
List of Pictures ......................................................................................................... vii
List of Tables ............................................................................................................ vii
List of Graphs ........................................................................................................... vii
INTRODUCTION .................................................................................................... 1
1. Reason for selecting research topic. ........................................................................ 1
2. Objectives of research ............................................................................................. 1
3. Subject and scope of research. ................................................................................ 1
4. Methods of research................................................................................................ 1
5. Structure of research ............................................................................................... 2
CHAPTER 1: LITERATURE REVIEWS ABOUT FREIGHT FORWARDING
SERVICES ................................................................................................................ 3
1.1. Freight forwarding service ................................................................................ 3
1.1.1. Definition .......................................................................................................... 3
1.1.2. Classification of freight forwarding services ..................................................... 3
1.1.3. Function of freight forwarding services ............................................................ 4
1.2. Freight forwarder .............................................................................................. 4
1.2.1. Definition .......................................................................................................... 4

1.2.2. Rights and obligations of freight forwarder....................................................... 5
1.2.3. Responsibilities of freight forwarder ................................................................. 5
1.3. Process of providing freight forwarding services for importing FCL cargoes 6
1.3.1. Signing delivery contract and receiving the imported documents ...................... 7
1.3.2. Registration of customs declaration ................................................................. 8

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1.3.3. Checking the goods ........................................................................................ 10
1.3.4. Paying tax, paying customs fees and retaking customs declaration ................. 11
1.3.5. Delivering the goods to the imported business ................................................ 12
1.3.6. Final settlement .............................................................................................. 13
1.4. Criteria to evaluate the freight forwarding service ........................................ 13
1.5. Advantages and disadvantages of freight forwarding services in Haiphong
city ........................................................................................................................... 15
CHAPTER 2: SITUATION OF FREIGHT FORWARDING SERVICES FOR
IMPORTING FCL CARGOES AT GOODTRANS – HAIPHONG ................... 19
2.1. Overview of GOODTRANS and Haiphong branch ....................................... 19
2.1.1. History of foundation and development ........................................................... 19
2.1.2. Overview of Haiphong branch of GOODTRANS ............................................. 20
2.1.3. Main services .................................................................................................. 21
2.1.4. Personnel structure ......................................................................................... 23
2.1.5. Situation of business operation in recent years ............................................... 24
2.2. Freight forwarding services for importing FCL cargoes ............................... 29
2.2.1. Freight forwarding process for importing FCL cargoes .................................. 29

2.2.1.1. Signing delivery contract and receiving the imported documents ................. 30
2.2.1.2. Transmitting the electronic customs declaration .......................................... 31
2.2.1.3. Paying tax .................................................................................................... 34
2.2.1.4. Printing the barcode declaration and registration of customs declaration ... 36
2.2.1.5. Checking the goods; retaking customs declaration and barcode declaration 38
2.2.1.6. Delivering the goods to the imported business ............................................. 39
2.2.1.7. Final settlement............................................................................................ 41
2.2.2. Result of freight forwarding process for importing FCL cargoes .................... 42
CHAPTER 3: RECOMMENDATIONS TO IMPROVE THE FREIGHT
FORWARDING SERVICES FOR IMPORTING FCL CARGOES AT
GOODTRANS – HAIPHONG BRANCH ............................................................. 43
3.1. SWOT analysis of freight forwarding services for importing FCL cargoes . 43
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3.2. Objectives and orientations for business operations ...................................... 46
3.3. Recommendations to improve freight forwarding services for importing FCL
cargoes ..................................................................................................................... 47
3.3.1. Build the specific diagram of freight forwarding process for importing FCL
cargoes ..................................................................................................................... 47
3.3.2. Research to develop and expand the market .................................................... 49
3.3.3. Improve the quality of service, create the proactive position and the reputation
in the business operation of the branch and maintain the trust with customers ......... 49
3.3.4. Improve the level of professionalism and the sense of responsibility of
employees ................................................................................................................. 50
3.3.5. Modernize the available technical facilities to meet the new demands of the

market ...................................................................................................................... 51
3.3.6. Limit the impact of seasonality ........................................................................ 51
3.3.7. Maintain the low costs .................................................................................... 52
CONCLUSION ....................................................................................................... 53
REFERENCE ......................................................................................................... 54
APPENDICES ........................................................................................................ 55

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LIST OF SYMBOLS & ABBREVIATIONS
FCL

Full container load

FIATA

International Federation of Freight Forwarders Associations

B/L

Bill of Lading

THC

Terminal Handling Charge

D/O

Delivery Order

ICD

Inland Containers Depot

VIFFAS

Vietnam Freight Forwarders Association

EIR

Equipment Interchange Receipt

HS CODE

Harmonized Commodity Description and Coding System Code

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LIST OF PICTURES
PICTURE 1.1: Freight forwarding process for importing FCL cargoes ....................... 6
PICTURE 1.2: ROPMIS model to evaluate the freight forwarding service. .............. 14
PICTURE 1.3: Position of ports in Haiphong city..................................................... 16
PICTURE 2.1: Personnel structure of Haiphong Branch of GOODTRANS .............. 23
PICTURE 2.2: Freight forwarding process for importing FCL cargoes of
GOODTRANS - Haiphong branch ........................................................................... 29
PICTURE 2.3: Login the electronic declaration software.......................................... 32
PICTURE 2.4: Enter the information of importing enterprise ................................... 32
PICTURE 2.5: Enter the information into the import declaration .............................. 33
PICTURE 2.6 Enter the list of imported goods ......................................................... 33
PICTURE 2.7: Access homepage of Vietnam Customs ............................................ 36
PICTURE 2.8: Enter the requested contents ............................................................. 37
PICTURE 3.1: Suggestion diagram of freight forwarding process for importing FCL
cargoes in Haiphong branch ...................................................................................... 48

LIST OF TABLES
TABLE 2.1: Overview of Haiphong branch .............................................................. 20
TABLE 2.2: Result of business operation in GOODTRANS – Haiphong branch from
2011 to first 9 months in 2015 .................................................................................. 25
TABLE 2.3: Business operation of the freight forwarding services for importing FCL
cargoes at GOODTRANS – Haiphong branch from 2011 to first 9 months in 2015 .. 28
TABLE 3.1: SWOT analysis of freight forwarding services for importing FCL cargoes
at GOODTRANS – Haiphong branch ...................................................................... 43

LIST OF GRAPHS
GRAPH 1.1: Volume of goods through the Haiphong port ....................................... 16
GRAPH 2.1: Business operation in GOODTRANS – Haiphong branch from 2011 to
first 9 months in 2015 ............................................................................................... 25
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INTRODUCTION
1. Reason for selecting research topic:
The trend of the internationalization of trade has linked countries with
different political systems into a single market; the development of economy in the
world has reached level that the borders of nations are only meaningful in terms of
administration. It is undeniable that transportation is a catalyst to promote the
development of national economy and expand the cooperation in term of
economics, political relations and socio-cultural exchanges. In particular, although
the freight forwarding service for importing and exporting FCL cargoes was still
very young, it has proven to be important in promoting international trade between
nations in the world. Perfection of the freight forwarding service for importing and
exporting cargoes is an important factor in economic and social development of
Vietnam and countries in the Southeast Asian region and the world.
From above reality, GOODTRANS Overseas Services Company Limited
was founded. Company provides services of customs procedures; forwarding
services of import and export goods in domestic and international by sea, air, road;
maritime brokerage and agency services. Freight forwarding activities for importing
and exporting cargoes at the company is a series of professional process steps and
each different mode of transportation has a different delivery process. However, this
report focuses on the status of the freight forwarding services for importing FCL
cargoes at GOODTRANS – Haiphong branch to propose some recommendations to
improve these services at this branch.
2. Objectives of research:

- Present literature reviews related to freight forwarding services
- Research about Haiphong Branch of GOODTRANS Overseas Services
Company Limited
- Research the current status of the freight forwarding services for importing
FCL cargoes at GOODTRANS – Haiphong branch to determine the
strengths and limitations of the service. Also propose some solutions and
recommendations to improve freight forwarding services for importing FCL
cargoes at this branch.
3. Subject and scope of research:
- Subject of research: the current status and operational process of the freight
forwarding services for importing FCL cargoes at GOODTRANS –
Haiphong branch.
- Scope of research:
+ Place: GOODTRANS Overseas Services Company Limited – Haiphong
Branch
+ Time: analyze the statistics of 5 recent years (2011, 2012, 2013, 2014 and
first 9 months in 2015)
4. Methods of research:
- Statistical method: Analyze the data, jump and drop of statistics.
- Description method: Describe the processes and the steps.
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-

Analysis method: Analyze, synthesize and compare the statistics from the

annual business report of the branch to make some comments on the
operational status of the branch and the results that the branch has achieved
as well as unfinished.
- Logic method: Combine the theoretical and practical foundation in freight
forwarding to synthesize and evaluate the operational status of the branch as
well as propose some solutions and recommendations to improve freight
forwarding services for importing FCL cargoes at the branch.
5. Structure of research:
Content of the report consists of three chapters:
-

Chapter 1: Literature reviews about freight forwarding services
Chapter 2: Situation of freight forwarding services for importing FCL
cargoes at GOODTRANS – Haiphong
Chapter 3: Recommendations to improve the freight forwarding services for
importing FCL cargoes at GOODTRANS – Haiphong

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CHAPTER 1: LITERATURE REVIEWS ABOUT FREIGHT
FORWARDING SERVICES
1.1 Freight forwarding service:
1.1.1. Definition:
According to model rules of FIATA (International Federation of Freight

Forwarders Associations), freight forwarding services can be defined as any kind of
services related to carriage, consolidation, storage, handing, packing and
distribution of goods; any advising services and other related services; including but
not limited custom issues, finance, procurement of insurance of goods, or procuring
payment and documents of transportation.1
According to Vietnam Commercial Law, freight forwarding services are
commercial operations; forwarders have responsibilities to carriage, storage,
carrying out procedures and other services to transport goods from an owner to
other owners or organizations (referred collectively to as customer). 2
In short, freight forwarding services are collection of behaviors and
procedures related to transporting process in order to deliver goods from a place (or
sender) to destination (or recipient). Forwarder can do their services directly or by
using 3rd parties (outsource).
1.1.2. Classification of freight forwarding services:
1.1.2.1. Based on the scope of activities:
-

Domestic freight forwarding services
International freight forwarding services

1.1.2.2. Based on the means of freight forwarding service:
-

Freight forwarding services by sea
Freight forwarding services by air
Freight forwarding services by rail
Freight forwarding services by road
Multi-modal transportation
…

1

Assoc. Dr. Hoang Van Chau (1999), "Curriculum of freight forwarding transportation", Science and
Technology Publishing.
2
Vietnam Commercial Law”, 2005, Article 163.

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1.1.3. Function of freight forwarding service:
-

Contribute to improve the efficiency of management, reduce the cost of
production process and strengthen the competitiveness of business.
Save and reduce the cost of circulation and distribution.
Contribute to expand the international trade market.
Reduce the cost; improve and standardize the documentation in international
business.
Increase the business value of freight forwarding business.

1.2. Freight forwarder:
1.2.1. Definition:
According to model rules of FIATA (International Federation of Freight
Forwarders Associations), freight forwarder has responsibility for the transportation
of goods followed by the entrustment contract and acts for the benefit of authorizer

although not as the carrier. Freight forwarder also undertakes the implementation of
all the works related to delivery and receipt contract such as preservation, storage,
transshipment, customs procedures, goods inspection...3
According to Vietnam Commercial Law, freight forwarder is a trader who
has the certificate of business registration of freight forwarding services. 4
In short, people who provide freight forwarding services are called as
"Forwarder, Freight Forwarder or Forwarding agent". Freight forwarder may be
goods owner, ship owner, handling company or warehouse, professional freight
forwarder or another person.
Forwarders have professional qualifications such as:
-

-

Know how to combine different modes of transportation.
Thank to the consolidation service, know how to take advantage of capacity
and tonnage of shipping tools maximally.
Know how to combine transport - logistics - import and export, have good
relationships with organizations related to the process of goods transportation
such as Customs, Shipping Agency, Station and Port ...
Create favorable conditions for the import and export business to help them
operate efficiently with freight forwarding services.
The import and export business can use the forwarder's warehouses to reduce
the construction costs of warehousing.
The import and export business can reduce the costs of administrative
management; and organizational structure is simple. Also they have
conditions to focus on import and export business.

3

Assoc. Dr. Hoang Van Chau (1999), "Curriculum of freight forwarding transportation", Science and
Technology Publishing.
4
“Vietnam Commercial Law”, 2005, Article 164.

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1.2.2. Rights and obligations of freight forwarder:
According to Vietnam Commercial Law, freight forwarder has the following
rights and obligations5:
-

-

Forwarders receive remuneration and other reasonable incomes.
Implement fully their obligations according to the contract.
During the contract performance, if there are justifiable reasons for the
benefit of customers, forwarder can implement works which are different
from the customer's instructions and notify immediately to them.
After signing the contract, if there is any issue which could lead to the failure
in the implementation of whole or part of the customer's instructions,
forwarder must notify immediately to customers and ask additional
instructions.

In the case that the contract does not have agreement on specific deadline to

fulfill the obligations to customers, freight forwarders must implement their
obligations in a reasonable period.
1.2.3. Responsibilities of freight forwarder:
1.2.3.1. When freight forwarder is the forwarding agent:
Depending on the functions of forwarder, the forwarder must to implement
fully their obligations according to the contract which is signed and must be
responsible for the following:
-

Shortcoming in buying insurance for the goods although there were
instructions
Shortcoming in the customs procedures
Transport goods to wrong specified location
Transport goods to wrong consignee
Deliver without collecting money from the consignee
Do not republish according to the necessary procedures or non-refundable
tax
The loss of assets and people of a third person whom forwarder caused.

However, the forwarder does not take responsibility for mistakes of the third
person if company demonstrates that the select is needed.
When freight forwarders are the forwarding agents, they must follow the
“Standard Trading Conditions”.
1.2.3.2. When freight forwarder is the carrier:
When being the carrier, freight forwarders have role as independent
contractors to provide the services that customers require. They must be responsible
for the acts and mistakes of the carriers and other forwarders who are hired to
5

“Vietnam Commercial Law”, 2005, Article 167.

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perform transportation contracts. Their rights, obligations and responsibilities are
regulated by the rules of the transport modes. Carriers collect payments from
customers whom they provide services according to the price of service without
commissions.
When freight forwarders provide services related to transportation such as
packaging, storage, handling or distribution.... they will be responsible as the carrier
if:
-

They perform these services by their own means of transportation
(performing carrier)
Or they release their transport documents and commit clearly that they are
responsible as a carrier (contracting carrier)

When acting as a carrier, the standard business conditions often do not apply,
instead of international conventions or the rules which are issued by the
International Chamber of Commerce. However, freight forwarders are not
responsible for loss or damage of goods which arise from the following cases:
-

Due to the fault of the customer or customer's trustee
Customers pack and mark the inconsistent codes

Due to the nature of the goods
Due to the war or strike
Due to the majeure cases

1.3. Process of providing freight forwarding services for importing FCL
cargoes:

Signing delivery
contract and
receiving the
imported
documents

Final settlement

Registration of
customs
declaration

Checking the
goods

Delivering the
goods to the
imported business

Paying tax,
paying customs
fees and retaking
customs

declaration

Picture 1.1: Freight forwarding process for importing FCL cargoes

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1.3.1. Signing delivery contract and receiving the imported documents:
1.3.1.1. Signing a delivery contract for importing FCL cargoes with the imported
company:
Company signs a delivery contract for importing FCL cargoe with the
partner (imported company). The purpose of the signing is the best agreement
which is beneficial for both sides. When signing the contract, they should note some
following issues:
-

-

There is agreement and consistent with each other about all the essential
terms.
Before signing, the contract must be considered and collated carefully the
agreements which have been agreed
The contract should be presented all the issue clearly. Also it reflects
accurately the contents of agreement and avoid dilemma
The terms of the contract must be derived from the characteristics of the
commodity, natural and social situations... in the country of the buyer, the

seller, the characteristics and relationships between both sides.
The contract does not contain terms which are contrary to the existing laws
in the country of the buyer and seller.

1.3.1.2. Receiving and checking the imported documents:
Freight forwarding company will receive an original set of documents from
partner (import business) including: Sale Contract, Commercial Invoice, Packing
List, Bill of lading and Arrival Notice.
When receiving complete set of documents from partner, employee of the
freight forwarding company are responsible for checking the set of documents
before making the declaration for customs procedures. To ensure accuracy,
consistent and valid for set of documents, this employee have to check carefully and
ensure that all documents fit together, especially with contract. During the checking,
if finding out mistakes of the documents, they must notify immediately to the
customer in order to adjust promptly.
Checking the Sales Contract
Check name of the importer, number and date of contract, name of goods,
quantity, unit, unit price, value, foreign currency payment, terms of payment, terms
of delivery, delivery deadline and payment deadline.
Checking the Commercial Invoice
Check number and date of invoice, other details: name of goods, quantity of
goods, unit price, value and unit... All of them must be same on the sales contract.
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Checking the Packing list

Check the name of the consignee and the consignor (they must be same on
the invoice), unit, number of carton or package, net weight, gross weight, packing
specifications and kind of packages.
Checking the Bill of lading
Check the name of the consignee and the consignor, name of vessel, number
of voyage, port of loading, port of discharge, name of goods, net weight, volume,
number of packages, date of loading on board, departure date, date of arrival and the
number of container and seal.
1.3.2. Registration of customs declaration:
1.3.2.1. Registration of customs declaration:
The mission of good owners or legal representatives is declaring fully and
exactly all the contents on customs declaration which are required by the customs
authority, customs employees do not declare on behalf of goods owners.
Customs declarations are the compulsory legal documents to declare the
objects of customs procedures. They are made in the standard form which are
provided by General Department of Customs.
For imported goods, documents must be submitted including:
-

Customs declaration (2 originals)
Appendices of declaration (2 originals)
Letter of recommendation (1 original)
Contract (1 copy)
Commercial Invoice (1 original)
Packing list (1 original)
Bill of lading (1 original)
Other documents (if applicable)

After the declaration of imported goods are certified that it completed the
customs procedures, a set of documents will be returned to people who declare

goods to conduct the clearance of goods; goods owners are responsible for keeping
the set of documents by the period of 5 years. The remaining set in the customs
authority is reexamined and stored in accordance with the laws of the General
Department of Customs.
The duration of customs procedures for imported shipments:
In the period of 30 consecutive days, when ship comes the port of discharge
which is recorded on the bill of lading; "Customs declaration of imported goods
have to be made before or within 30 days from date when the goods comes the port
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of discharge; the customs declaration has the value of customs procedures within 15
days from the date of registration".6
Location to carry out the customs procedures:
Location to carry out the customs procedures is place to complete the
declaration procedures, present the issues which need to check and conduct the
obligation to pay customs taxes. Customs procedures can be made in any place
which is the most convenient for goods owners.
1.3.2.2. Calculating the tax:
The dutiable value of imported goods: is the actual price which the importer
must pay, it is accounted from the first imported gate. Also it is determined by
applying sequentially six determining methods of dutiable value. The checking
purpose of the dutiable value declaration is to determine the dutiable value, inspect
the compliance with laws in the declaration of the customs declarer, ensure correct
value and method in the declaration and collect correct and sufficient taxes for the
state budget.

There are six determining methods of the dutiable value of imported goods,
including:
-

Determine by the transaction value method
Determine by the transaction value method of identical goods
Determine by the transaction value method of similar goods
Determine by the method of deduction
Determine by the method of calculation
Determine by the method of inference
The process of checking the dutiable value includes three steps:
Step 1: Checking the set of documents
Step 2: Checking the goods
Step 3: Performing other works related to the price

In particular, the result of the actual inspection is to identify the violations of
businesses in the incorrect declarations with actual goods (wrong names, wrong
type and origin ...) which affect the determination of dutiable value.
Time for calculating the import and export taxes:
This is date that goods owner submits customs declaration for customs
authority, and the import and export taxes are calculated according to tax rates, tax
calculation prices and exchange rates at the time of the filing declaration. Exceeding
15 days from the date of filing the declaration but goods owner does not have real
6

“Law of Customs”, 2005, Article 18.

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imported goods, customs declaration must be reworked and submitted to the
customs authorities. Time for tax calculation is the date of filing the declaration
later.
Deadline for the tax notice:
- This is based on the principle that goods owners declare tax and pay taxes
themselves.
- Within a period of 8 hours from the time that customs authority has
finished the checking of real imported goods, if there are differences in the original
tax declaration, customs authority must notify the insufficient or excess tax
compared with a tax announced according to declaration for goods owner.
- Goods are required following by the rules of technical and quality standards
to ensure the accuracy of the tax calculation. Deadline for the tax notice is a
maximum of 15 working days from the date that declaration is registered by goods
owner.
1.3.3. Checking the goods:
With FCL imported goods, when the goods in the container arrive at
inspection location, customs employees who are responsible for goods inspection
must to check the number of container, the seal number of ship owner and the seal
number of Customs. If the number of container and the number of seal are incorrect
(or the seal of Customs is lost), customs employees must to make a written record
and report immediately to the leadership. If the number of container and the number
of seal are correct, customs employees open container to check the goods.
For the goods which need to check the details, customs employees check all
goods in container.
For the goods which are allowed to check the representative goods, three
requirements must to ensure when checking:

-

Check the goods at the bottom and the top of the container
Check the goods on both sides of the container
Check the goods at both ends of the container

Goods will be divided in order to check on the extent of priority. Based on
the form of order, checking level of customs authority are divided into three main
flows:
In the green flow:
Exempting from checking the detail of documents and the checking the
actual goods. Time of checking the goods is not exceed three hours. This is the flow
of goods which have tax being zero or are exempted from tax. Also this is the flow
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of the businesses which abide strictly by law, declaration procedures are registered
quickly, the rate of checking is low, the goods are released immediately after the
checking goods is finish (in a period of one year which is accounted from the date
on the declaration, business has not been handled behaviors related to the fraud and
evasion of tax).
In the yellow flow:
Check the details of documents, exempt from checking the actual goods.
Time of checking the goods is 5-6 hours, maximum of 8 hours. This is the flow of
goods which have export and import tax. Also this is the flow of the businesses
which often violate the law, the rate of checking is high or must to check the whole,

businesses must to calculate and make tax notices before releasing the goods.
In the red flow:
Check the detail of documents and the actual goods. Time of checking the
goods depends on the complexity of each case. This is the flow of goods which
have complex documents. Also this is the flow of the businesses which have many
serious violations of law, must be controlled and monitored closely, businesses
must to complete all customs procedures before releasing the goods.
Responsibilities of employees who make the customs procedures:
-

Show all the goods to customs authority to check by specified time and
place.
Arrange vehicles and employees to serve the checking the goods of customs
authority.
Always being available during the checking of goods.

In the case that employees who make the customs procedures do not agree
with the checking results of customs authority, they have the right to ask for
assessment in the inspection organization which was permitted by the State. If the
customs authority do not agree with the assessment results, the customs authority
requests the Ministry of Science and Technology or the Ministry of specialized
management to solve. Conclusion of the Ministry of Science and Technology or the
Ministry of specialized management is the final determination.
1.3.4. Paying tax, paying customs fees and retaking customs declaration:
Paying tax:
If imported goods are the materials for production:
Must pay tax in the nine months (calculated as 275 consecutive days) from
the date which customs declaration is registered. Conditions for application:

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-

Having a contract
Taxpayers do not owe tax exceeding the time stipulated by the import and
export tax (at the time that the goods are imported)
Having the registration of imported materials

Exceeding the period of nine months, businesses will be fined for late tax
payment (after the 31st day from the date of customs declaration registration to the
date of submission).
If imported goods are the consumer goods:
Imported goods in the category of consumer goods which are regulated by
the Ministry of Trade must be paid tax before the goods are imported, not including
some following cases:
If there is a guarantee on the amount of tax, deadline for tax payment is 30
days from the date of customs declaration registration.
If exceeding the deadline, businesses have not paid imported tax, guarantor
must pay on behalf of business. Also businesses are fined due to delay the tax
payment.
Paying the customs fees:
When exporting and importing the goods, organizations and individuals in
Vietnam as well as foreign organizations and individuals must pay customs fees in
the following cases:
-

Make customs procedures for exported and imported goods
The goods are consigned or stored in customs warehouses
Escort and seal for goods
Reissue the customs documents and licenses for the service activities under
the jurisdiction of customs authority
Goods, luggages and vehicles in transit

1.3.5. Delivering the goods to the imported business:
1.3.5.1. Receiving the goods at port:
With FCL imported goods, when receiving Arrival notice, goods owner
brings Bill of lading (1 original) and Letter of recommendation (1 original) to ship
owner to take the Delivery order (D/O). Goods owner brings D/O to customs
authority to make procedures and register the checking of goods (goods owners can
bring the container to their own warehouse or ICD (Inland Container Depot) to
check the goods, but they must return the container box on time, if not, they can be
fined).

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Recommendations to improve the freight forwarding services for importing
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After completing the customs procedures, goods owner must bring all
documents of receiving goods and D/O to ship management office at port to
confirm the D/O. Last is getting Goods delivery note and receiving goods.
1.3.5.2. Dispatching the means of transportation:
Frieght forwarding company prepares mean of transportation to take goods

in the Port. Depending on the contract signed with imported business, company will
arrange suitable mean of transportation. In the case that there is any change about
mean of transportation, company must notify to customer.
1.3.5.3. Liquidation of goods at the customs gateway:
Goods and mean of transportation will be clearance after completing the
customs procedures. During the waiting time for the results of assessment to
determine that goods are allowed to import or not, if goods need to be preserved, the
Head of Customs will accept in the case that goods meet the requirements of
customs supervision.
1.3.5.4. Delivering to the imported business:
After completing the customs procedures and receiving goods, freight
forwarding company is responsible for delivery the goods to the imported business.
Not only that, on delivery, both sides should provide receipts and ensure that always
fulfill obligations.
1.3.6. Final settlement:
Paying the costs related to freight forwarding works. After that, gathering the
necessary documents, complain to the relevant authorities about the loss of the
goods (if applicable) and following the results of complaint.
1.4. Criteria to evaluate the freight forwarding service:
There are numerous research models about the freight forwarding service in
the world. Among them, the models including SERVQUAL (Parasuraman &
partner, 1988), SERVPERF (Cronin & Taylor, 1992) and technical
quality/functional quality (Gronroos, 1983) are more popular. However, this
dissertation uses the ROPMIS model (Thai Van Vinh and Devinder Grewal, 2007)
which was established recently, being a new and suitable model for the evaluating
of the freight forwarding service. According to this model, the freight forwarding
services are assessed by six components: Resources, Outcomes, Process,
Management, Image and Social Responsibility. These six components evaluate
satisfaction of customers when they use the freight forwarding services of company.
After that, company can assess their freight forwarding services easily.

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Resources

Outcomes

Process
Satisfaction
Management

Freight
forwarding
service

Image

Social Responsibility

Picture 1.2: ROPMIS model to evaluate the freight forwarding service
Source: Thai Van Vinh & Devinder Grewal (2007), “ROPMIS model”
Resources:
Staffs need to have professional qualifications, experience and dynamism.
They organize all the stages of freight forwarding activities such as transaction
activities with customers, checking documents and customs procedures. Works are

completed as soon as possible. Also they know to limit the stagnant documents
which waste time of customer as well as delay the work.
Outcomes:
-

Deliver on time that were committed
Make sure all the factors: Safe - Saving - Quick - Accurate to bring the
highest efficiency in the work of delivery
Limit the cost with the package freight forwarding services by providing
transportation services
Make sure that the delivery of goods to customers perfectly
Process:

-

Implement strictly professional processes: customs declaration, paying taxes,
liquidation of declaration. Make sure that processes are done in the shortest
possible time

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Recommendations to improve the freight forwarding services for importing
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Accuracy is a major factor which decides the quality and the completion
level of work, including the accuracy in the quantity, quality, actual extent,

goods owner and brand
Management:

-

Manage professionally; operate and monitor the working process
comprehensively
Operate and manage effectively; have orientation and direction for the
development of company
Image:

-

Create a good image in the eyes of customers about style of service
Create the trust and the reputation with customers
Social Responsibility:

Take responsibility in contributing to the social construction and sense of
responsibility to the nation.
Satisfaction:
-

Satisfaction of customers with services which are provided
Customers continue to use these products and services
Customers advertise for everyone to use

1.5. Advantages and disadvantages of freight forwarding services in Haiphong
city:
Haiphong city is located in the most dynamic region of Vietnam currently
(the northern key economic). Not only that, it is located in a favorable position

where can exchange easily with all provinces in the country and all nations in the
world by sea, rail, road and air... This can make Haiphong become the country's
leading province in the exchange of goods, services and receiving the technical and
scientific achievements of the world.
Haiphong has 125 kilometers of coastline, with five districts bordered the sea
namely Do Son, Thuy Nguyen, Kien Thuy, Hai An, Tien Lang and two island
districts namely Cat Hai and Bach Long Vi. If taking the sea area with a depth of
less than 20 meters, Haiphong has 4,000 km2 of sea area which is about 2.6 times of
the land area. Haiphong is port city with developed port system and this system has
contributed to create jobs for thousands of workers, contributing significantly in the
development of Haiphong in particular and Vietnam in general.
Looking back at the development history of over 100 years, can say that the
urbanization of Haiphong city associated with the ups and downs steps of Haiphong
port. It is one of the two largest port system in Vietnam, including more than 40
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Recommendations to improve the freight forwarding services for importing
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different ports with many different functions, such as shipping of bulk, materials,
iron, liquid chemicals (petrol, oil, gas) and container; harbor for shipbuilding;
harbor for cargo ships by small river... Haiphong port is gradually built to a seaport
which has modern and advanced handling technology. Imported and exported goods
of 17 northern provinces and transit goods of northern Laos and southern China...
are passed Haiphong port to foreign markets and opposite.

Picture 1.3: Position of ports in Haiphong city
Source: vietstock.vn

Thus, with the above outstanding advantage, sea and coastal of Haiphong
city have role as the center of marine economic development and international
cooperation in the north and in the country. Also it is the largest gateway to help
key economic regions and the North integrate with regional and international areas.
Besides, the marine economy of Haiphong developed rapidly, contributing
significantly to the city and the coastal areas of Tokin Gulf. There are many marine
economic sectors which are the motivation for the development of the city, the
northern region and the country; attracting increasingly the resources and investors.
However, the marine economy development of Hai Phong is not
commensurate with the potential and advantages of the city, and now the city is
facing big challenges from many social problems. Firstly, infrastructure is poor and
insufficient to meet the economic growth and the quick population growth.Traffic
jam, flooding and environmental pollution... are increasingly becoming popular,
being the obsession of people. Moreover, transportation infrastructure for logistics
services in Haiphong port is lack of synchronization. Port infrastructure is weak,
while transportation infrastructure which links the port to the outside are difficult,
especially for the super weight trucks.
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