Ocean Container Liner Shipping Enterprise Cost Management And A Number Of Issues Discussed

In the intensely competitive market, with the trade characteristics of high inputs and low returns, it is necessary and important for ocean container liner companies to tighten up the cost management. After studying the actual situation of cost management of COSCO Container Liner Co, Ltd. (COSCON), the writer find some problems, and try to study three urgent ones, and makes some suggestions on how the company strengthens its cost management. During studying, on the basis of studying the actual situation of the company, the writer approaches the problems with the theories of cost accounting. This article includes five chapters.In chapter 1, the introduction, the writer explains that liner companies have to strengthen its cost management because of the existing state and trade characteristics of liner industry. And then, according to the actual situation of liner companies, the writer raises three urgent problems of the cost management. The study method is also pointed out in this chapter.In chapter 2, the problem of the allocation of container fixed cost is discussed. Ocean container liner shipping, with the carrier of container, realizes the grouped shipping. Container fixed cost hold big proportion in total shipping cost of liner companies. The reasonable allocation of container fixed cost will have good effect on the correctness of the cost of shipping lines and voyages. In this article, the writer studies the approaches of allocating container fixed cost established by COSCON, and finds the approaches do not accord with the compensation principle of cost allocation. And then, the writer reclassifies the items of container fixed cost, and takes reasonable allocation bases; so as to form the new approaches of allocating container fixed cost. The new approaches will provide information of more accurate cost of shipping lines and voyages for company to make correct policies.In chapter 3, the problem of the control of voyage operating expenses is discussed. Besides the fixed investment of vessels and containers etc., the voyage operating expenses of container companies, such as container freight charges, port charges, and fuel charges, etc. are also in great amount. However, companies just control fuel charges by norms. As freight charges, port charges etc., have set rates and charge rules, these charges are not regarded as controllable ones. Companies just check the trip account sent by agents in ports, to avoid unreasonable charges. After studying, the writer insists that amount of freight charges, port charges, etc., has a bearing on the operation of concernedpeople in vessels and agents in ports. These charges are controllable to a certain extent. Then, the writer suggests that control standards should be established for freight and port charges. The control standards should be the voyage budgets of detailed items port by port. The concerned people in vessels and port agents should well operate according to the voyage budgets, to avoid the unreasonable charges. The company should analyze the cost variance after voyage, so as to control the voyage operating expenses effectively.In chapter 4, what talked about is the introduction of activity based costing system to the cost management of liner companies. In the intensive global competition situation, large ocean container liner companies carry out customer oriented shipping services on the basis of multimodal transportation. And the monomodel of "port to port" shipping services is broken. The customers and services of liner companies are many and varied. After activity based cost analyzing for different customers and services, it shows that the expenses of the company to different customer and services are greatly varied. So, in the new situation, the company could not make its policies well if it still take the line shipping services as the cost object, and calculate line and voyage or average cost pre TEU. Customers and services should be taken as the cost object, and the real cost of different customers and services should be understood, so as to...