Optimization Research Of "A" Container Liner’s Demurrage&Detention Charge Control

In cost structures of container transportation, the container equipment cost is the third-largest cost item which is next to port charges and the fixed cost of ships, about20-25%percent of total costs. How to minimize the container equipment costs become the urgent problem to be addressed in front of the shipping companies. In order to accelerate the container turnover and utilization rate, it’s common for the shipping companies to levy demurrage and detention of containers as a subsidy to offset the ever-growing idle costs of equipment. The theses of this dissertation focus on how to manage the container’s demurrage and detention so that it’s maximum to play a charge leverage to reduce the equipment costs by empirical studies of the practices within Company A.This article firstly describes the business processes of container transportation, and the reasons to collect the demurrage and detention of containers, at the same time, briefly overview of the definitions, types and causes of container’s demurrage and detention. Furthermore, also introduced the risk factors involved in its management or operation. Secondly, in accordance with the "issue-analysis of problem-solving issues raised" logics, the theoretical basis of integrated risk management related, and my actual work experience, a comprehensive analysis of the problems and causes during management of container’s demurrage and detention. Finally, thru combining theory with practice, aiming at the disadvantages in the management of Company A’s demurrage and detention, it’s exploring the optimization measures to improve its management. These measures mainly focus on three areas:One is on system adaptation. The recommendations are respectively on optimized calculation rules, systematized the process of discount approval and rendering accounts, improved the customer and credit system management, as well as providing the value-added services to the customers.Second is on process re-engineering. The recommendations are mainly focusing on the management of account receivable that center on how to strengthen the administration of before, during and after the event. Third is on customer management and optimization. Through the establishment of a sound customer and credit management system, thereby improving the comprehensive evaluation system of customer.