Supply chain management

Assignment
Submitted To : Miss Fatima
Student name: Syed Shaheer Ahmed
Student Id: 2707-2016

Assignment No : 1

RFID: RFID is stand for “radio-frequency identification” and refers to a

technology whereby digital data encoded in RFID tags or smart labels (defined
below) are captured by a reader via radio waves. RFID is similar to barcoding in
that data from a tag or label are captured by a device that stores the data in a
database. RFID, however, has several advantages over systems that use barcode
asset tracking software. The most notable is that RFID tag data can be read
outside the line-of-sight, whereas barcodes must be aligned with an optical
scanner.

Barcode: A barcode is a square or rectangular image consisting of a

series of parallel black lines and white spaces of varying widths that can be read
by a scanner. Barcodes are applied to products as a means of quick
identification. They are used in retail stores as part of the purchase process, in
warehouses to track inventory, and on invoices to assist in accounting, among
many other uses. There are two types of barcode .

1) 1-Dimensional (1d)
2) 2-dimensional(2d)
RFID and Barcode in warehouse management:

The features of modern warehouse management, we put forward a

warehouse management system (WMS) based on Radio Frequency
Identification (RFID), and probe into the structure and operation flow of
the system. The WMS will adopt RFID middleware as the support
platform, cover goods entry, picking, checking, delivery and many other
operation flows, and can collect, deliver, check, and update mass
Data on the frequent warehouse entry and delivery, so as to decrease the
labour intensity, avoid fault scanning, miss scanning, re-scanning and
other artificial errors, and improve the efficiency and accuracy. The
WMS based on RFID will help to improve the efficiency of warehouse
Management, and make rapid self-recording of receiving
And delivery. In the supply chain, the warehouse is always at the joint of
the processes, like between purchasing and manufacturing, between pre-
treating and finishing processing, between manufacturing and selling,
between wholesale and retailing, and among the switch of transportations
With the development of concepts of the global operation strategy and the
supply chain management, the warehouse management becomes more
and more important in the supply chain. As a modern data-collection
tool, RFID will be applied widely in the warehouse management system
with its remarkable advantage. The WMS will adopt the RFID
middleware system as the support platform, including goods receiving,
warehousing, picking, matching, stock taking, withdrawing, forklifts
locating and dispatching and many other flow packages, which can be
assembled flexibly, and customized to new function packages that can be
operated independently, or connected smoothly. Today’s modern supply
chain businesses leverage a combination of RFID tags and readers,
barcode labels and long-range mobile scanners to increase the speed and
ease of data collection to asset tracking. By combining barcode and RFID
data capture methods and relational database software, supply chain
businesses can improve the speed and accuracy of their processes,
including locating, retrieving, and accounting for anything that moves in
or out of the facility. Supply chain businesses that leverage mobile
barcode and RFID solutions are able to increase turnover and optimize
inventory, as well as improve the accuracy of their manufacturing,
ordering, and/or shipping. When productivity is significantly improved,
resources can be reallocated to higher-value activities or more vital areas.

Barcode and RFID solutions can improve productivity through the

following business aspects:

1. Labour hours and costs:

What once took employees hours to accomplish can be achieved in

minutes with barcode and RFID data collection. Scanning a barcode or
RFID tag takes significantly less time than manually entering the
information. Also, increased mobility allows them to minimize back-and-
forth. The two technologies allow workers to significantly reduce labor-
intensive, manual processes by instantaneously identifying items and
automatically storing item information in your central computer system.
Each minute or hour you are able to shave off of each process means
more time to accomplish other needs or move onto the next project,
increasing productivity and reducing labour costs. Not to mention — any
labour related to paperwork can be eliminated completely, as all
information can be entered and stored digitally.

2. Data accuracy and quality control:

Using barcode and RFID solutions to automate the data entry process can
reduce or even eliminate the errors that inevitably occur when data is
entered manually — because even the most skilled typists make an error
every 300 keystrokes. Being able to scan barcode labels and read RFID
tags using a mobile device instead of manually entering item IDs
character-by-character can make a world of difference. This enables an
improvement in data accuracy, which will then trickle down to improve
the accuracy of orders and shipments, as well as the quality control
process.

3. Inventory management and assets training: It’s extremely difficult

and time-consuming to manufacture products or pack shipments in an
unorganized facility. You should never have to worry that a necessary
tool or machine has gone missing or that materials were distributed
incorrectly. Having a firm grasp on both your inventory and your assets
will help you to run your business much more smoothly — and keep your
customers happy. Facilities can use barcode and RFID data to increase
inventory visibility or gain stronger insight into the materials that come in
and out of the facility. By attaching a RFID tag or barcode label to
inventory items, you can trace your assets throughout the supply chain to:

 reduce shrinkage and loss

 confirm deliveries
 combat counterfeiting
 facilitate recalls.

In addition to data collection for effective inventory management, RFID

tags allow manufacturing and distribution companies to manage and track
the lifecycle of mobile and fixed assets — tools, equipment, products,
pallets, etc. — in real time. Facilities can combine barcode and RFID
solutions with relational database software to quickly locate any asset,
track its history from acquisition to disposal, and reduce audit time.

Assignment No : 2

Question no :1

Incoterm:
Since 1939, Incoterms, developed by the International Chamber of
Commerce (“ICC”), have been accepted by traders and governments
worldwide to explain important terms such as insurance, carriage or risk
of loss. The CISG has been interpreted to incorporate the International
Chamber of Commerce’s Incoterms provisions. Hence, in a case in which
an EU business sold to an American buyer medical equipment that
became damaged during transport, an American Court found that the
seller was responsible under the Incoterms for paying the cost of freight
and insurance coverage necessary to bring the goods to the port
designated. However, the court also found that the risk of loss (or
damage) passed to the American buyer, even if the title to the equipment
did not change until full payment by the buyer. Thus, the buyer was
obligated to pay both the full agreed upon sale price and to pursue
restitution from the buyer’s insurance company for the damaged
equipment. Incoterms forestall disarray in remote exchange shrinks by
explaining the commitments of purchasers and dealers. Gatherings
engaged with household and universal exchange regularly use them as a
sort of shorthand to help comprehend each other and the specific terms of
their business plans. Some Incoterms apply to any methods for
transportation; others apply carefully to transportation across water.

Key takeaway:
 Traders use Incoterms to help understand one another in domestic
and international trade.
 The ICC developed Incoterms in 1936 and updates them
periodically to conform to changing trade practices.
 Typical examples of Incoterms rules for any mode of transportation
include "Delivered at Terminal," "Delivered Duty Paid," and "Ex
Works (EXW)."

Use of incoterm:
The method of reasoning for utilizing Incoterms is to ease or
decrease disarray over translation of transportation terms, by laying
out precisely who is committed to assume responsibility for and
additionally protect products at a specific point in the delivery
procedure. Further, the terms will layout the commitments for the
leeway of the products for fare or import, and prerequisites on the
pressing of things.

Question: 2

Incoterm 2013:
Incoterms for any Mode or Modes of Transport
Are a set of three-letter standard trade terms most commonly used
in international contracts for the sale of goods. It is essential that
you are aware of your terms of trade prior to shipment.

EXW – EX WORKS (… named place of delivery)

The Seller’s only responsibility is to make the goods available at

the Seller’s premises. The Buyer bears full costs and risks of
moving the goods from there to destination.
Example: exw is using for trade easily and smoothly between
buyer and seller in the boundaries of a country it’s help to
minimize the risk and enhance the value of trade in between buyer
and seller through letter of credit through different policies etc.

FCA – FREE CARRIER (… named place of delivery)

The Seller delivers the goods, cleared for export, to the carrier
selected by the Buyer. The Seller loads the goods if the carrier
pickup is at the Seller’s premises. From that point, the Buyer bears
the costs and risks of moving the goods to destination.

Example: the carrier are using for transporting goods or raw

material to one place to another.

CPT – CARRIAGE PAID TO (… named place of destination)

The Seller pays for moving the goods to destination. From the time
the goods are transferred to the first carrier, the Buyer bears the
risks of loss or damage.
Example: the CPT is charging more prices than any other
transporting good or services it’s directly transfer your good to
words to one origin to another without any changing of carriage.

CIP– CARRIAGE AND INSURANCE PAID TO (… named

place of destination)
The Seller pays for moving the goods to destination. From the time
the goods are transferred to the first carrier, the Buyer bears the
risks of loss or damage. The Seller, however, purchases the cargo
insurance.
Example: CIP is you are taking an insurance policy as per a
safety of a product or goods its minimum the risk factor but you
have to paid some extra charges on insurance policy in between
trading.

DAT – DELIVERED AT TERMINAL (… named terminal at

port or place of destination)

The Seller delivers when the goods, once unloaded from the
arriving means of transport, are placed at the Buyer’s disposal at a
named terminal at the named port or place of destination.
“Terminal” includes any place, whether covered or not, such as a
quay, warehouse, container yard or road, rail or air cargo terminal.
The Seller bears all risks involved in bringing the goods to and
unloading them at the terminal at the named port or place of
destination.
Example: DAT is automatic process in most of modern ports like
chines port in Chinghai automatically computerize system and
vehicles delivered the good port to terminal and terminal to ship.

DAP – DELIVERED AT PLACE (… named place of

destination)

The Seller delivers when the goods are placed at the Buyer’s
disposal on the arriving means of transport ready for unloading at
the names place of destination. The Seller bears all risks involved
in bringing the goods to the named place.
Example: this step is starting form clearance when you are
clearing your shipment to the ship yard the last procedure is
clearing the good after all the payments when you show the all
slips and take your personal vehicle to take the container to your
store or warehouse.
DDP – DELIVERED DUTY PAID (… named place)

The Seller delivers the goods -cleared for import – to the Buyer at
destination. The Seller bears all costs and risks of moving the
goods to destination, including the payment of Customs duties and
taxes.
Example: the last step when you are clearing your all payments
you have to pay to a person to deliver goods on your store is the
DDP.

Incoterms for Sea and Inland Waterway

Transport

FAS – FREE ALONGSIDE SHIP (… named port of shipment)

The Seller delivers the goods to the origin port. From that point,
the Buyer bears all costs and risks of loss or damage.

Example: FAS is mainly using on when buyer bears all loses ,

damages and delivery charges to one end to another end.

FOB– FREE ON BOARD (… named port of shipment)

The Seller delivers the goods on board the ship and clears the
goods for export. From that point, the Buyer bears all costs and
risks of loss or damage.
Example: delivery on board are done ugly by small distances
may one country to another which may not have much distance and
easily transfers the product on board . when someone transferring
the product on board is duty free it’s mean you are transferring the
goods privately.

CFR– COST AND FREIGHT (… named port of destination)

The Seller clears the goods for export and pays the costs of moving
the goods to destination. The Buyer bears all risks of loss or
damage.
Example: CFR is the process in which the insurance is not
involve in it the buyer and seller is agreed to deliver a good to one
origin to another origin without any insurance it take risk but
mostly it take on risk free item .

CIF – COST INSURANCE AND FREIGHT (… named port of

destination)
The Seller clears the goods for export and pays the costs of moving
the goods to the port of destination.
The Buyer bears all risks of loss or damage. The Seller, however,
purchases the cargo insurance.
Example: CIF is the process in which buyer and seller agreed on
trade agreement in which insurance policy is included and all cost
is bearing by buyer.