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Transporation Planning Assignment

COMPANY - YANCOAL MINING LTD COMPANY IN AUSTRALIA WHICH IS IMPORTING THE MACHINERY.

Question Provide a sound transportation plan for importing the mining equipment (Hydraulic Shovel) from Peru to Western Australia.

Your transportation plan must provide the reasoning behind transportation decisions, giving a balanced justification for the basis of decisions.

Solution:

Introduction:

According to (The Role of Transportation in Supply Chain Management, 2018), Transportation is one of the main areas of Supply chain Management, apart from Purchasing and Manufacturing. Some of the key decisions that have to be made in this sector relate to the timing of obtaining raw materials/finished goods from their origin point to their final destination.

According to (Tseng, 2005), transportation accounts for about 30% of all the logistical operations of a company.

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Objective:
In this assignment, our goal is to devise a transportation plan to ascertain the best way possible to transport a pre-owned Hydraulic Shovel from a supplier in Peru to our company - Yancoal Mining Ltd, in Western Australia.

Identification of the product to be imported and ascertaining the price
Assuming that this process is complete, we are at the stage where a potential supplier is identified in Peru and the product that is selected is a used hydraulic excavator.

Transport Option and Reasons:
According to (Excavators 320, 2019), the average weight of a caterpillar is around 22,500 kgs, therefore the sea route would be the most ideal more of transportation. One off the best routes for this can be from Port Callao in Peru, to Port Fremantle in Western Australia.

Licensing and Permits to be obtained
According to (Importing and Exporting, 2019), Australian Customs will have to clear any machinery that's imported from another country and would usually involve:
a. Obtaining the necessary import permits, the quarantine permits and other treatments that apply to this category of machinery and
b. Ascertaining whether the imported machinery conforms to the mandatory health and safety standards.
Since we would be importing a second hand-machinery, we need to follow the guide laid out by the Australian Government.
To apply for a Vehicle Import Approval, we first need to ascertain if the vehicle is eligible to be imported into Australia. Once this is determined, we need to select the relevant import option. The instructions are clearly laid out by (Special Purpose Vehicle Option, 2019).

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Costs
The next important step is to ascertain the relevant costs associated with importing the vehicle into Australia. The costs would generally include:
- Shipping costs
- Storage and delivery costs
- Application for permit
- Taxes and customs duties
- Quarantine and inspection costs
- Insurance
- Territory registration costs
- Other costs related to repairs
- Miscellaneous costs such as loading and unloading costs and costs related to moving the vehicle from the port to the site of operations.

Timeframes
After the above step, it is essential to understand the timeframes of getting various permits and registration requirements. This ensures that no time is wasted while waiting for approvals and completing other formalities.
According to (Processing applications, 2019), it would usually take up to 20 business days for the Department to communicate about the status of the application - whether the import request would be approved or rejected. The website also lists other resources that we can follow during the import process.
The website also lists the "Registered Automotive Workshop Scheme" that can be looked into. This, however, applies to vehicles that are mentioned in the register for specialist and enthusiast vehicles.
In addition to this, we could also contact our Bank to ascertain the costs related to payment and other finance options.

Other Considerations - Taking the help of a Broker
While direct quotes can be obtained by contacting carriers such as Searates.com, I would also recommend that we take the help of a Registered Broker to assist in matters pertaining to import duty rates, looking out for tariff concessions, dealing with quarantine requirements and providing an estimate of other costs.
The Customs Brokers and Forwarders Council has a list of registered brokers in a directory that you can obtain from (CBFCA, 2019).

After obtaining Import Approval
After obtaining import approval, shipping of the vehicle can be arranged. The vehicle can be received after paying the necessary customs duties and obtaining clearance from the customs department and paying necessary taxes. The vehicle would then have to be examined by the quarantine department to ensure that the vehicle meets the requirements. After this, modification or repair of the vehicle, if required can be undertaken. This is usually followed by the registration of the vehicle, after which it can be used at the mining site.

Conclusion
To conclude, the above mentioned steps can be followed to ensure that the vehicle that was purchased in Peru can be transported to Australia in the most effective and efficient way possible.

This document lists out the various steps that the manager can take a look at and implement while importing the vehicle.

It is also recommended that the help of a registered broker is taken as brokers are familiar with various aspects such as import duties, ascertaining if the vehicle qualifies for a concession and other costs. This would be one of the most cost-friendly ways of transporting the vehicle to the country.

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