Use the data in Assignment A1. Produce a TCO to deliver theproduct to the end destination. Use the following information:
The Shipping costs are $1,000 for a 20’ and $2,000 for a 40’container
The BAF is $350 for the 20’ and $500 for the 40’
Accessorial fees are 20% of the shipping costs
THC for sending terminal is $300 for the 20’ container and $450for the 40’ container.
Drayage to and from the port is $150 for the 20’ container and$250 for the 40’ container.
Booking fee is $75
ACE Charge is $70
Import Brokerage fee is $200 per entry.
Inspection fee for the Hazardous shipment in export country $100per container
Duties are 4.25% of the value of goods at the port of entry,including insurance.
Marine insurance is 0. 4% of the value of the goods at the portof loading.
THC for the Receiving Terminal is $425 for the 20’ container and$800 for the 40’ container.
Times for movement or information flows:
Booking fee to the packed container moved to the export port is7 days
Terminal time to load on board is 4 days
Ship sailing time to the port of destination is 26 days
Offloading and customs clearance is 17 days
Delivery time in the country of delivery is 15 days
Delivery charges in the country of delivery are $125 per 20’container and $200 per 40’ container.
WACC is 15%
The TCO calculations must be done for both the 20’ and 40’container sizes.
Then compare the TCO of the two containers sizes at percontainer and total shipments as spreadsheet calculations withformulas.
You must create the spreadsheet so that anyone can change any ofthe numbers given above and the answers are visible in thespreadsheet. The sheet will be tested for this aspect.
The TCO must identify the costs to each party of buyer andseller, assuming an Incoterm of CFR (Port ofHouston, Bayport Container Terminal) Incoterms 2010.
For this product move, what would be your choice of Incoterm tomaximize the value to your company, increase your profitability andcustomer service, and minimize your risk?
