Analysis of logistics costs in transporting goods from Thailand to Shanghai, people's republic of China during the Covid-19 epidemic: Evidence from the international freight forwarding industry
Abstract:
The objectives of this research were to analyse the logistics costs in transporting goods from Thailand to Shanghai, People's Republic of China; and to investigate the opportunities and limitations of exporting goods from Thailand to Shanghai, People's Republic of China during the COVID-19 epidemic.
This research examined the transportation of goods via container system, including Full Container Load (FCL) and Less than Container Load (LCL), from 20 international freight forwarding companies. The instrument used to collect data was a price questionnaire under various international shipping agreements in transporting goods from Bangkok Port and Laem Chabang Port to Shanghai Port. This research examined a triangular aspect of information from academic experts, experts from the business sector and the executive director of the International Freight Forwarders Association (TIFFA).
The study results revealed that the average logistics costs of transporting goods from Bangkok Port to Shanghai with FCL was 56,840.70 Baht per 1 x20 GP container (33 Cubic Meter: CBM) comprising 78.88% transportation costs, 3.12% warehouse costs, 5.29% storage costs, and 12.71% administrative cost, while LCL incurred average logistics costs of 15,613.40 Baht for 5.4 CBM broken down to 48.55% transportation costs, 6.81 % warehouse costs, 6.81% storage costs, and 37.82% were administrative costs. Additionally, it was found that the COVID-19 epidemic created an opportunity to export goods from Thailand to Shanghai due to the increase in demand for Thai products from Chinese consumers as a result of the decline in Thai export activities; but offset by the threat that freight forwarders are now burdened with higher costs due to increased
logistics costs. It was also found that two of the 2010 International Commercial Terms, namely Free on Board (FOB) and Cost, Insurance & Freight (CIF) terms, were appropriate. Moreover, exporters and importers must also take into account the cost of local charges that they have to pay as well.