Cost Component Explanation And

Yield Management System:

Cost Component Explanation and

Table Preparation Guidance

2014/Oct/3 Amendment in Page 3, 8, 11-12

The scope itself of YMS cost will basically be the same as current NCTV system; it will cover many of variable costs (such as Loading, Discharging, Feeder, Equipment, etc.), but excludes agency commission, detention/demurrage. It will not cover so called “system cost” or “fixed cost” (such as port charges, bunker consumption, vessel hire, etc.), but “Reefer Onboard Bunker Consumption” is an exception to be included in the scope.

YMS Basic Variable Costs Coverage in P/L (in RED)
Cargo Charge
Commission
Feeder/Dray
USA Rail
Equipment
Empty Cost
T/S Freight
KLPL CCA (payable)
KLPL CCA (receivable)
Others 1
Others 2
Others 3

Depending on the nature of the cost, cost record should be prepared based on contract tariff rate, or averaged unit rate. It is requested that RMOs will update the cost record regularly; for contract tariff rate, please update whenever the rate is renewed. For averaged based unit rate, please review at least once in half a year.

RMOs are requested to prepare cost tables and constantly maintain them up to date; this will be the key for YMS users to know correct cost and NCTV.

Cost items are divided to defined input formats by nature of its cost. You may notice that cost items explained here are close to Saisan cost item structure. This is intended to make the relationship between YMS NCTV and P/L clearer than the current NCTV system cost structure.

** Some exceptions are not mentioned here like Rfr OnboardBunker

Registered cost will be assigned based on the shipment’s route in YMS. Some cost will be based on the each point of route, and some other will be based on the combination of from-to points, etc.

“Shipment’s Route” here means both “standard routes” prepared by TMOs in pricing function, and each Booking/BL’s itinerary in Booking/BL function.

[Standard Cycle of Shipment Route]

In Pricing function, TMO users will basically see the aggregate cost amount by cost group (e.g. the level in number 1,2,3.. . like “1. CY Cost Related”written below), not by individual cost components.

Below is the explanation of each YMS cost item and guidance intended for RMOs to have the common understanding. In this document, we specifically focus on the cost items that we will ask RMOs to prepare. We will also explain the meaning of the new input fields together.

For the full list of cost components and its input format, please refer to the separate excel sheet. Note that this cost list and its definition is for the outset, and we will be open to add new cost or adjust the definition if agreed among parties concerned later on.

1. CY Cost Related(CARGO)> RMOs

1-a. Full Throughput

[Red dots show the points where cost will usually incur]

One of the mandatory cost items under this category(“Mandatory” means the system will not prompt as “missing” cost when application shipment route exists). Almost equivalent to current NCTV system’s CY Load/Discharge Basic and equivalent to Saisan item 72001. Rates should be prepared for DRY, and OTP/FLR (if applicable). We expect contract (or public) tariff rates will be prepared by RMOs. If the contract will have special agreement such as yearly discount, please deduct it from the tariff rate by your best estimate. RMOs are requested to update the cost table when there is contract renewal.

In the current NCTV system, this cost is required for KL services only. However, in YMS, it is also required for Feeder’s CY cost if Feeder cost is registered as FI or FO basis. Please also refer to Transportation Cost explanation later in the chapter 2.

[Example1] (Examples are only showing a part of input format, not full fields, to distinctly show the focus topic.)

Item / Location / Service / Container Type / FT20 / FT40
Full Throughput / IDJKT / JABCO-2 / Dry / 100 / 200
Full Throughput / IDJKT / Feeder / Dry / 110 / 210

> Not just for KL service but also for Feeder, Full Throughput will be required if Feeder registration will be done by non CY-CY basis.

Also in YMS, no need to input “zero cost” for receipt/delivery type = FI/FO.

[Example2]Sample record in current NCTV system

Item / Location / Service / Receipt Type / Amount20 / Amount40
CY-BASIC / JPYOK / CALCO-B / FI / 0 / 0

> This “zero” cost input is no more required.

Unlike current NCTV system,there is no need to segregate by Load/Discharge but only needs one record registration in YMS. New fields are added such as Facility Code, Vessel Operator code, Transport mode, Effective From, Effective To, Pricing Use Flag, Container Type. Here is the explanation of each new field.

1-a-1.Facility Code – Optional Item. Contract rate may differ by facility (terminal) whilst the location code is the same. In such case, RMO can utilize this field. The facility code must be the same as what is used in Vessel schedule. This differentiation by facility will only work in cost assignment to BL, because in Pricing, there’s no facility information available. Please contact us if you need to have the list of facility codes.

[Example3]

Item / Location / Service / Facility Code / Pricing Use Flag / Container Type / FT20 / FT40
Full Throughput / JPTYO / JASECO-5 / OHI-2 / Y / Dry / 100 / 200
Full Throughput / JPTYO / JASECO-5 / OHI-7 / Dry / 110 / 210

> You can have multiple rate for the same location, same service by different facility code.

1-a-2.Transport Mode – Optional Item. This is to differentiate rates by connecting transport mode. For example, in some port, throughput rate will differ in case it is connecting to Truck against Rail, or Rail against Local delivery, etc. By utilizing this Transport Mode, RMOs can differentiate the rates by the difference in connection mode to the port. For Load, it will be referring to the previous transportation mode. For Discharge, it will be referring to the next transportation mode.

[Example4]

Item / Location / Service / Trans Mode / Pricing Use Flag / Container Type / FT20 / FT40
Full Throughput / DEHAM / NE2 / F / Y / Dry / 150 / 250
Full Throughput / DEHAM / NE2 / Y / Dry / 110 / 210

> You can have different rates for the same port, service by different transport mode.

[List of Transport Mode]

Code / Description
F / FEEDER
R / RAIL
T / TRUCK
TF / TRUCK/FEEDER
TR / TRUCK/RAIL

1-a-3.Vsl Operator Code – This is to differentiate the rates by vessel operator code. It is optional item and can be utilized if the rates will differ by vessel operator. Same as Facility code above, this operator code should be same as what is used in Vessel schedule. The rate differentiation in cost assignment will work only in case of BL and is not valid in Pricing function, as there’s no vessel operator information in the standard routing. Please contact us if you need the list of vessel operator code.

[Example5]

Item / Location / Service / Vsl Operator / Pricing Use Flag / Container Type / FT20 / FT40
Full Throughput / JPYOK / ESACO / KKLU / Y / Dry / 150 / 250
Full Throughput / JPYOK / ESACO / YMLU / Dry / 110 / 210

> You can have different rates for the same port, service by different vessel operator.

1-a-4.Effective From/To – Should be input by year month, YYYYMM and is mandatory item. In the previous NCTV system, there’s no notion of rate validity in cost registration, however YMS can hold multiple records by different Year Month. Therefore RMOs are requested to input Effective From/To based on the actual contract length. (Please do not input Effective To as indefinite such as 209912).

Please avoidmake overlapping Year Month records. We understand in some cases the contract may expire by the middle of a month. Unfortunately YMS will not be able to meet this situation since having different rate by day will increase too much burden to the system. Please reformat to month in a way you think is appropriate in such situation.

[Example6]

Item / Location / Service / Effective From / Effective To / Container Type / FT20 / FT40
Full Throughput / JPYOK / ESACO / 201301 / 201312 / Dry / 150 / 250
Full Throughput / JPYOK / ESACO / 201401 / 201412 / Dry / 110 / 210

1-a-5. Pricing Use Flag

This is new in YMS. As explained in Facility Code and Vessel Operator code, YMS allows to have multiple rates under one port, service. This will be used in case of BL cost assignment but in Pricing function which will be based on standard routing, such key information is not available and therefore some indicator will be necessary for the system to judge which rate will be applicable in Pricing. When this flag is set as Y, it means the rate will be used in Pricing function.

[Example7]

> In cost table, you can have two different rate by facility code. However we need RMOs to provide which is “Standard” and therefore should be used in Pricing function by “Pricing Use Flag”.

1-a-6. Container Type

Unlike the current NCTV that all container type will be input in one line, YMS will have multiple rate lines per container type (similar to FCA style). Therefore when you need to input multiple have rates for different container type, please input as following.

[Example8]

Item / Location / Service / Trans Mode / Pricing Use Flag / Container Type / FT20 / FT40
Full Throughput / DEHAM / NE2 / Y / DRY / 150 / 250
Full Throughput / DEHAM / NE2 / Y / OTP / 110 / 210

[List of Container Type]

Code / Description
DRY / Dry
RFR / Reefer
FLR / Flat Rack
OTP / Open Top

1-b. Full Throughput Reefer

One of the mandatory cost items under this category.This cost is Reefer version of 1-a. Full Throughput and will be assigned to live reefer only. It could be confusing but this is different from “CY-LOAD/DISCHARGE-REEFER” in the current NCTV system. “CY- LOAD/DISCHARGE-REEFER” was top up to “CY-LOAD/DISCHARGE-BASIC” but this new Full Throughput Reefer serves as basic cost, not the addition. Other than this point, explanation on the fields is the same as 1-a. Full Throughput.

1-c. Full Gate

Equivalent to Saisan item 72011. Other explanation and the format is the same as 1-a. Full Throughput.

1-d. Empty Gate

Equivalent to Saisan item 79321. The cost is for “empty” in nature but will be included in CY Cost related group, as it usually goes together with 1-d. Full Gate.

1-e. Additional Charge

Optional cost item. Equivalent to Saisan cost item 72034. E.g. extra stevedorage, night work, holiday additional etc. Cost format is the same as Full throughput however registration by country code (e.g. CN) without service code specified is acceptable. We understand it would be difficult to set the rate amount from contract tariff, and therefore it is acceptable to use country wise average unit cost; Cost derived from past several months Saisan result, divided by laden unit count.

[Example9]

Item / Location / Service / Pricing Use Flag / Container Type / FT20 / FT40
Additional Charge / CN / Y / Dry / 10 / 20

> No need to be location/service specific but country code without service is acceptable.Or,

Item / Location / Service / Pricing Use Flag / Container Type / FT20 / FT40
Additional Charge / CHSHA / CALCO-C / Y / Dry / 40 / 80

Specify location, service.

1-f.Other THC

Optional cost item. Equivalent to Saisan cost item 72036 (for non RFR only). Other explanation is the same as 1-e. Additional Charge.Registration by country code (e.g. CN) without service code specified is acceptable.

1-g.Other THC RFR

1-g-1. Other THC RFR In

1-g-2. Other THC RFR Out

1-g-3. Other THC RFR T/S

Optional cost item. Equivalent to Saisan cost item 72036 (for RFR). Reefer Monitoring Cost (if separate from contract tariff) should be put into this cost item.Registration by country code (e.g. CN) without service code specified is acceptable.Same as Storage-IN, OUT, T/S in 1-n/o/p, in the input format we have Per Type and Average Days. RMOs can choose the rate type is per CON or per Day.

1-h. Tally

Optional cost item. Equivalent to Saisan cost item 72038. If there are contract tariff, please register it. If it is difficult, country wise Saisan average will also be acceptable. Other explanation is the same as 1-e. Additional Charge.Registration by country code (e.g. CN) without service code specified is acceptable.

1-i. Assessment

Optional cost item. Equivalent to Saisan cost item 72041. If there are contract tariff, please register it. If it is difficult, country wise Saisan average will also be acceptable. Other explanation is the same as 1-e. Additional Charge.Registration by country code (e.g. CN) without service code specified is acceptable.

1-j. Wharfage

Optional cost item. Equivalent to Saisan cost item 72051. If there are contract tariff, please register it. If it is difficult, country wise Saisan average will also be acceptable. Other explanation is the same as 1-e. Additional Charge.Registration by country code (e.g. CN) without service code specified is acceptable.

1-k. T/S Throughput

1-l. T/S Throughput Reefer

One of the mandatory cost items under this category. This is equivalent to “T/S LOAD/DISCHARGE BASIC” in current NCTV. In YMS, there is no need to prepare cost for Load and Discharge separately, but oneThroughput rate will suffice. Please note that this rate must be “1 move” basis instead of 2 moves.

1-l. T/S Throughput Reefer will be used for live reefer rate and 1-k. T/S Throughput for other container type.

One important difference from the current NCTV system is the cost assignment logic from/to connecting feeder. In current NCTV system, always CY-Load/Discharge-Basic will be assigned to the start/end point of KL service. Therefore, even when the shipment connects to/from feeder and the actual applicable rate should be T/S rate, NCTV system assigned the wrong cost. YMS will change the logic so that T/S Full Throughput will be assigned in such case.

[Example10]

From / To / Service
IDJKT / SGSIN / ASECO Feeder
SGSIN / NLRTM / NE2

> If the shipment itinerary is as above, current NCTV assigns CY-LOAD-Basic on red SGSIN. YMS will assign T/S Throughput rate instead.

Again same as 1-a. Full Throughput, in YMS, it is also required for Feeder’s T/S cost if Feeder cost is registered as FI or FO basis. Please also refer to Transportation Cost explanation in chapter 2.

1-m. CFS Load/Discharge

Optional cost item. Applicable only when either receipt type or delivery type is CFS and this will be add-on to the throughput.

1-n. Storage In

1-o. Storage Out

1-p. Storage T/S

These are Cargo Storage, Saisan item 72071. The input format is similar to that of 1-a. Full Throughput, however there is one difference. In the input format we have Per Type and Average Days. Registration by country code (e.g. CN) without service code specified is acceptable.

[Example11]

Item / Location / Service / Container Type / FT20 / FT40 / Per Type / Average Days
Storage IN / CLVAP / Dry / 150 / 250 / CON

> You can register per unit cost by Per Type CON, or

Item / Location / Service / Container Type / FT20 / FT40 / Per Type / Average Days
Storage IN / CLVAP / Dry / 15 / 30 / DAY / 5

> You can register per unit cost by Per Type Day with Average Days

1-p-1. PerType, Average Days – In per type, please choose either per CON or per Day. And when per Day is selected, you are requested to also fill in Average Days. If per CON is selected, Average Days is not necessary. YMS cost calculation when per Day is selected will be [FT20] x [Average Days] for instance. We understand in contract tariff it is not unusual that the rate is per day, not per box. Therefore YMS allows users to choose either way of cost registration. But again let us repeat when per Day is selected, Average Days has to be also populated.

For 1-p. Storage T/S, please put a half of average days at T/S port; then YMS will assign the cost twice (like current NCTV’s T/S-LOAD-BASIC and T/S-DISCHARGE-BASIC).

2. FDR/DRAY Cost Related (TRANSPORT)> RMOs

Transportation Cost category deals with Saisan items 7251, 7252, and 7253.

2-a. Rail

2-b.Truck

2-c. Rail&Truck

2-d. Truck&Feeder

Not much difference from the current NCTV system. Basically cost will be assigned based on the itinerary’s combination of from location/to location with respective transport mode. There are several new fields added to the current one which will be explained below.

2-e. Feeder All

2-f. Feeder Slot

2-g. Feeder CY + Slot

2-h. Feeder Slot + CY

There will be no more Feeder / Barge / Domestic Feeder difference in cost item but these are incorporated into Feeder cost.

Feeder cost in YMS will have four ways of registration. Though it may sounds complicated, it simply tries to follow various terms of feeder transport contract.

For example, when 2-e. Feeder All is selected, it means the term is CY-CY basis (including both end THCs). When 2-f. Feeder Slot is selected, it means the term is FI/FO basis, and both end THCs will be assigned from Feeder Throughput rate of 2-n/o/p/q, the rate of which having the service as “Feeder”. In the same way, when 2-g. Feeder CY + Slot is selected, it means CY-FO term and discharge cost will be assigned from Feeder Throughput rate. When 2-h. Feeder Slot + CY is selected, it means FI-CY term and loading cost will be assigned from Feeder Throughput rate.To illustrate, there are variety of ways to input based on actual contract term.

[4 ways of Feeder cost registration]

O.THC / Sea / D.THC
Feeder All
Feeder Slot
Feeder CY + Slot
Feeder Slot + CY

> Purple part will be the cost covered by each cost item. Blue part will be supplied by either Feeder Full Throughput or Feeder T/S Throughput. “Feeder All” is same as the current NCTV’s Feeder cost.

2-n. Feeder Full Throughput

2-o. Feeder Full Throughput RFR

2-p. Feeder T/S Throughput