Low less-than-container load (LCL) container utilization in the ocean freight department of Vietnam D

Abstract

Vietnam D Company is a leading logistics company in the freight forwarding industry. Although the company has a strong market position and skilled team, they are facing the challenge with low LCL container utilization in the Ocean Freight Department. This inefficiency does not only raise the cost of operation, but also has an impact on the reliability of the service and profitability. The purpose of the thesis is to explore the reasons behind the suboptimal container utilization and suggest practical solutions to improve operational performance. The study employs both primary and secondary research approaches. Secondary data were gathered through reports in the industry, documents of the company, as well as previous research on supply chain and logistics management. The main data were gathered with the help of qualitative interviews with the key stakeholders in Sales, Operations, and OCC teams. These interviews provided practical insights into present forecasting and coordinating problems of the company. Based on the validation of possible causes, the absence of a formalized forecasting and coordination system was the primary reason for low LCL container utilization. This issue has resulted in fragmented communication, data inconsistencies and reactive planning across departments. Two proposed solutions were introduced: (1) Introduction of an Integrated Digital Planning System and (2) a Centralized Forecasting Coordination Process on the basis of the SCOR Model. Upon a thorough analysis of cost and feasibility, along with the appropriateness of the solution to the existing capabilities of the company, the second solution that has been chosen would be the most adequate one in the short- to medium-term. An action plan was created to lead the solution's implementation, with a focus on standardized forecasting techniques, specified accountability, and structured departmental communication systems. This is not only a way of improving the accuracy of the forecast and interdepartmental alignment but also a stepping stone to the digital transformation in the future. The application of the process will enable the Vietnam D Company to make an immediate positive impact on the LCL container usage, operational visibility, and efficiency in decision-making, which will be followed by the long-term positive changes in the field of the logistics industry.