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EPPM2033

1.0.

Introduction Courier industry in Malaysia has evolved into a new perspective with more than 100 players in the market. Skynet Worldwide (M) Sdn Bhd. is proud to be one of the leading domestic courier companies with current the complete network located strategically in both Peninsular and East Malaysia. Forming strategic alliances with DPEX Worldwide Pte. Ltd. Is Skynets competitive advantage in developing in international market not just regionally; it enables Skynet to provide Fast, Accurate, Reliable express service to Skynets clients everywhere on earth. In this case study, mainly focus on how Skynet worldwide (M) Sdn Bhd operate, and how Skynet manage to delivery goods worldwide (international shipments) and also how Skynet promote its courier products and services to the customers. In this case study we will undertsand how courier company such like Skynet Worldwide (M) Sdn Bhd operate and how they handle service delivery from Sender until Receiver for international shipment and also domestics. In the process of delivery goods/package/parcel/documents to international

destination, involve so many process such like how goods/package will processing in logistics, warehouse, depot, cargo, then how Skynet manage the transportation for delivery the goods/package to international destination. During process delivery goods/package(International shipment) also invloving insurance coverage of packages/goods,and customs & tax duties.

UNIVERSITI KEBANGSAAN MALAYSIA

EPPM2033

2.0.

Objective The objectives of the Case study are: PRIMARY OBJECTIVES To know and understand how Skynet Worldwide (M) Sdn Bhd, operation in Malaysia To have a thorough understanding of how logistics system works in Skynet. To know how Skynet manage to delivery goods worldwide (process of delivery). To know how Skynet promote thiers Courier product & services. SECONDARY OBJECTIVE How Skynet co-operation or alliances with DPEX Worldwide Pte. Ltd. in developing in international market. To know about important of Logistics, Warehousing, Depot, Cargo, and Transportation In courier industry. Process involves in delivery goods worldwide (International shipment) Customs Policies and duties tax Risks of currency exchange in international trade Risks of delivery goods worldwide The dangerous item Insurance coverage To know whether the customers are satisfied with the existing range of service pattern. Competitive advantage

UNIVERSITI KEBANGSAAN MALAYSIA

EPPM2033

3.0.

Company Profile 3.1. About Skynet

Skynet Worldwide (M) Sdn Bhd is one of the leading domestic courier companies in Malaysia with more than 80 branches located strategically throughout the country and a strong alliance with DPEX Worldwide (HQ in Singapore) which covers more than 150 countries across the globe. We are committed to provide Fast, Accurate, Reliable (FAR) express delivery service to customers throughout the world. Skynet has been in Malaysia for more than 15 years and currently owns and operates an extensive network of 59 offices and 23 points of access with staff strength of more than 1000 people and 546 vehicles on the road and many air routes to and from East Malaysia and international destinations. Forming strategic alliances with DPEX Worldwide Pte. Ltd. Is our competitive advantage in developing in international market not just regionally; it enables us to provide Fast, Accurate, Reliable express service to our clients everywhere on earth. We provide next-day service, our core business, to our customers in all major and small towns. Thousands of documents and parcels move through our network system daily and arrive at consignee the very next day. HQ Skynet Worldwide (M) Sdn Bhd is strategically located in Petaling Jaya. We deliver the highest number of consignments in Klang Valley day in and day out for our stations as well as picking up the most consignments to send to our network for deliveries throughout Malaysia. On average, we deliver and pick up 9000 consignments daily. HQ in Petaling Jaya also serves as a hub for the network shipment. It transits and sorts all shipments from the entire network. We operate a road and air line-haul system daily in order for us to move all the consignments. Currently, we are running 18 routes of road line-hauls, besides Klang

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Valley line-hauls, whereas all trucks coming from stations to HQ carrying shipments for all stations and going back to stations with shipments meant for their deliveries. With 13 air line-hauls mainly to and from East Malaysia are in place to ensure the next day service. There are three international-bound air line-haul for all international shipments to Singapore and the rest of the world. Since 1994 Skynet has emerged itself in the development of fully integrated ICT system to link up all our stations in Malaysia and counterpart overseas. As a result of our established IT system Skynet was awarded SMB ICT Adoption Award 2006. The system Courier World has been the outcome of these efforts. Courier World (CW) is a full spectrum platform ICT System. It starts from pick up to POD image on the web and link directly to generate financial statements. This system has helped us to improve our efficiency and effort greatly. Human resource is extremely important in our nature of business; we constantly provide trainings, courses, workshops and seminars either internally or externally to all level of our staff to upkeep their skills and knowledge in order to enhance our service quality. Obtaining ISO 9001:2000 certification in June 2006 is only the beginning of our crest for high-level operations excellence mission, we want a Quality Management System (QMS) in our network not just a certificate of recognition. ISO will help to put in a systematic, competent and customer focused QMS in Skynet, thats why we take this certification seriously. We believe that a complete network coverage, a strong line-haul infrastructure and an advanced ICT in our system, we are poised to be a courier company in line of our vision as an Express Carrier of Choice and

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our mission of providing Fast, Accurate and Reliable (FAR) courier service to our clients everywhere on earth will be accomplished.

3.2.

Vision & Mision

Vision To be An Express Carreir of Choice. Mission Providing Fast, Accurate & Reliable (FAR) express service to our clients everywhere on earth.

3.3.

Corporate Quality Fast, Accurate and Reliable (FAR).

3.4.

Shared Value Dont give up Direct interaction Fail to plan, plan to fail Communication Coordination Admit & accept mistakes Proper HR practice Respect each other

3.5.

Quality Policy We strongly beleive in providing Fast Accurate Reliable (FAR) service to meet our customers requirements and strive to exceed meeting thier
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expectations. We are fully committed to continually improve our Quality Management System (QMS) to enhance our effectiveness to achieve customer satisfaction.

4.0.

Products & Services: 4.1. Types of Product & Rates. EXPRESS PARCEL DOMESTIC EXPRESS

EXPRESS DOCUMENTS

For the fastest Worldwide door to door delivery of your urgent document items that do not require customs declaration.

Worldwide door to door delivery of your urgent declarable items. Our efficient customs clearance staff will ensure fast delivery to your recipient. Three original invoices are required for the customs declaration.

When you need an efficient Countrywide delivery service that delivers value for money service, choose the Domestic Express service. We can collect and deliver to your requirements, whether you're sending documents or parcels you can expect a high quality service at affordable rates

*Rates are depend on type of products and weight (measure). *I had Attach Products Rates.
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4.2.

Services Special pick up and delivery Service Skynet offers a range of special collection and delivery options including: Extended service hours Weekend and holiday service Remote areas service Dedicated truck for heavy or bulky load. Diplomat Service Have you got a shipment that needs to be collected and delivered immediately? For shipments that just can't wait until tomorrow, Skynet offers a 24-hour door-to-door emergency delivery service. You can count on us to be Fast, Accurate & Reliable POD Information Service Proactive delivery notification via various channels such as e-mail, SMS, fax and phone for individual or complete shipment management upon request On-line tracking with advanced tracking facilities with image to monitor your shipments at www.Skynet.com.my Payment & Billing Services Skynet offers flexible billing and payment options for transport charges, duties and taxes. This flexibility gives you the freedom to bill the sender, receiver or a 3rd Party. Packaging Free of charge Standard Packaging that consists of Skynet flyers, bags and document envelopes Special Packaging that consists of premium quality Skynet cartons and
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boxes, meeting shipping requirements for many different products Advice on customs regulations and documentation Bulk Mailing When you have bulk shipments, call us and we will offer the following for your convenience. Skynet pick-up - no need to visit the post office Sorting - no need to sort your mail before pick-up Use of Skynet Air waybills / barcodes - simple and easy process and tracking of shipment status One simple invoice sent after shipping - no need for pre-payment Special Handling / Security Handling Special Handling Department at Skynet focuses on handling of sensitive materials, security and high valued items. This department has a separate sorting area as well as a special fleet of vehicles. Items designated to Special Delivery Department are handled by a group of specially trained staff. Warehousing We do pick and pack for your goods which are stored at our warehouse, it is an one stop service provider for all your goods throughout Malaysia.

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4.3.

Report Based on Skynet Worldwide (M) Sdn Bhd Annual Report show that 79% of shipment are within Malaysia (Domestic) and 21% are international shipment.

Sales

International 21%

Domestics 79%

4.4.

Promotion To promote Skynets courier products/services, Skynet make sure that both quality and quantity of service at cheapest price and also fast service with cheaper rates as well as other facilities of online tracking, competitive rates. The lowest price and good services are most effective way to way to promote courier service. These are some way how Skynet promote thiers services: Advertisement Online Ad Website and Blog Referrals through loyalty customers

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EPPM2033

5.0.

Customers & Payments 5.1. Types of customers

Skynet mainly focus certain type of customers, which are: Small businesses Meeting customers expectations through IT Public People

5.2.

Customers Feedback Skynet always make sure all customers satsified with Skynet services and it is important that Skynet continue improving quality of service through customer feedback. Through Customer Feedback is best way to ensure measure company current quality services. And it is also cheapest way. To ensure Skynet quality of service is the better than its competitors, Best way to do this is to listen to your Customer Feedback and take action if to do so. Customer satisfaction is to make sure company sale always growing. Customer comments, suggestions and responses about a company's products, business practices and customer service orientation are one of the biggest advantages of customer feedback surveys. Critical inputs and answers can help a company to develop better customer-retention programs.

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5.3.

Other Facilities to Customers Skynet offer other facilities to customers to make sure customers always get the best services from Skynet. The facilities Skynet offer are: Online tracking and live update Billing services Membership to get best price For Business Customers- Skynet Pickup the goods from door to doors services.

Some Example of how live online tarcking works:

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EPPM2033

5.4.

Payment Methods Skynet offers flexible billing and payment options for transport charges, duties and taxes. This flexibility gives you the freedom to bill the sender, receiver or a 3rd Party.

Skynet only accept 2 type of payment, which are: Cash Credit Card

6.0.

Guarantees & Quality of Services 6.1. Guarantees We guarantee all of our services at Reliable Runners. At our option, we will either refund or credit your transportation charges upon request if we deliver your shipment late or more after our delivery commitment. We will attempt to notify you twice by phone if there is any change in the time of delivery. Skynet will refund money back in some case, which is: Late Delivery Broken or damage or lost due delivery (Skynet will cover losses) 6.2. Insurance Courier insurance is a specialty insurance that covers individuals who deliver products for a fee. Mostly courier service has courier insurance now. What courier insurance will do is prevent you from being held personally liable if the materials you are carrying and delivering are damaged or stolen during transit. They wont protect the vehicle or the individual, they will only protect the value of the materials being delivered. The basic function of courier insurance is its coverage property such like packages or documents for a fee, while it's in your car or truck.

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So in case, your document, parcel or package lost or damage when delivery Skynet will cover customers lost- the value of items. Courier insurance policies are generally inexpensive. Skynet will cover any losses or damage during delivery the goods through insurance that customer buy.

6.3.

Award & Recognition Since 1994 Skynet has emerged itself in the development of fully integrated ICT system to link up all our stations in Malaysia and counterpart overseas. As a result of our established IT system Skynet was awarded SMB ICT Adoption Award 2006. The system Courier World has been the outcome of these efforts. Courier World (CW) is a full spectrum platform ICT System. It starts from pick up to POD image on the web and link directly to generate financial statements. This system has helped us to improve our efficiency and effort greatly.

Recognition :Certified ISO 9001:2000

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EPPM2033

7.0.

Rules & Other Information 7.1. Rules *See the attachment for more detail about rules in courier service.

7.2.

Restricted commodities

RESTRICTED COMMODITIES (Dangerous Goods) All items can be shipped through our service EXCEPT THE FOLLOWING: Drugs Plants Hazardous Materials Firearms Perishables Pornographic Materials Tobacco Liquor Livestock Cosmetics Currency (Cash) Pirated CD, VCD, DVD VOLUMETRIC CHARGING When sending a bulky but lightweight items, volumetric charges will be applicable. This is to make up the space the shipment will occupy on the aircraft. Passport IATA Restricted Items Precious Stones Pharmaceuticals

FORMULA VOLUMETRIC WEIGHT = Length ( Cm ) X Width (Cm) X Height (Cm ) / 6000

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7.3.

Does & Dont of Packing

DON'T send cash, jewellery, currency (We will no be liable or responsible for these shipments). DONT recycle old labels on shipping cartons.

DO place new address labels and have names and addresses of both shipper and recipient on each label. DON'T allow glass to touch glass.

DO wrap each item individually in cushioning foam material. DO have your fragile sticker attached

DON'T ship items wrapped in paper.

DON'T use household cellophane tape.

DO seal packages securely with pressure-sensitive plastic tape. DON'T ship items loose in carton.

DO use fillers for inside protection.

DON'T ship used hypodermic needles.

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EPPM2033

DON'T ship blood, urine or liquid diagnostic specimens;

DO follow requirements for approved packaging when shipping specimens.

DON'T allow packages to get damp or wet before they are picked up.

DON'T secure packages with string and rope.

DON'T use damaged cartons, cartons without flaps intact, or chipboard cartons.

DO use strong corrugated cardboard boxes.

7.4.

Tax Duties

DUTIES AND TAXES All duties and taxes will be bonded by con signee or shipper.

8.0.

Network & Affilities 8.1. Domestic

Below are Skynet Worldwide (M) Sdn Bhd, Station Network Area: West Malaysia

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8.2.

International

Skynet Worldwide (M) Sdn Bhd Forming strong strategic alliances with DPEX Worldwide Pte. Ltd. (HQ in Singapore) which covers more than 150 countries across the globe Is our competitive advantage in developing in international market not just regionally; it enables Skynet to provide Fast, Accurate, Reliable express service to our clients everywhere on earth. There are three international-bound air line-haul for all international shipments to Singapore and the rest of the world. We are committed to provide Fast, Accurate, Reliable (FAR) express delivery service to customers throughout the world.

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The DPEX Network stretches across 7 continents, providing the Global business community with fast, reliable and secure Express delivery to over 180 countries and territories Worldwide. DPEXs Worldwide Network of offices and agencies are substantial industry Express companies in their respective Countries, providing peace of mind to our local customers.

"Net-Trak" DPEX fully integrated shipment tracking system, links DPEX network of Worldwide offices, allowing every DPEX Country to exchange data, thereby ensuring DPEX customers can be fully updated on the status of their shipment at all times. Through DPEX wholly owned system and communications centre, "Net-Trak" can provide such features as "track and trace" and "proof of delivery" via the internet. Through DPEX network of franchisees and alliances provide access to 7 worldwide hubs, 340 service centers, the use of 265 flights per day, more than 2500 vehicles and over 4000 employees. DPEX network has the capabilities to serve effectively.

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Example of how Skynet network works (Domestics and International)

9.0.

Logistics 9.1. Logistics

Logistics is concerned with getting the products and services where they are needed and when they are desired. It is difficult to accomplish any marketing or manufacturing without logistical support. It involves the integration of information, transportation, inventory, warehousing, material handling, and packaging. The Skynet operating responsibility of logistics is the geographical repositioning of raw materials, work in process, and finished inventories where required at the lowest cost possible. Without logistics support no activity can be performed to meet defined goal. The current challenge is to perform logistics scientifically in order to optimize benefits to the organization. Logistics is a planning function of management. In Skynets,

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Logistics function is concerned with taking products and services where they are needed and when they are needed.

9.2.

Warehousing We do pick and pack for your goods which are stored at our warehouse, it is an one stop service provider for all your goods throughout Malaysia. Skynet Worldwide (M) Sdn Bhd manages and operates a fully dedicated warehouse facility equipped with a professional racking system in which Skynet utilize advance stock management softwares. Skynet can handle exchanges, credit and repair returns. They maintain optimum buffer stock and inventory levels that improve inventory accuracy. This includes, of course, items sorting, repackaging and labeling. Skynet ensures the international and national side of the logistics operations from the warehousing to the final distribution.

9.3.

Depot Courier depot is the result of Skynets effort to provide convenience to Skynets customers everywhere. It is basically a drop-off point for Skynets customers. Skynet are in the midst of providing multi point-of-access to Skynet customers to make it simple, easy and convenient for customers to send customers document or parcel through Skynet service. As Skynet continue to strike for customer service excellence, Skynet have appointed selected businesses at convenient locations throughout the major towns in Malaysia to team up with Skynet to provide drop-off service. It is a service point where customers can transact any courier or express delivery activities.

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9.4.

Cargo

Cargo transport is a form of transport which is designed to move goods from one location to another. Also known as freight transport, cargo transport is typically used to move products which are intended for commercial sale, although things like mail may also be treated as cargo for transport purposes. There are a number of different kinds of cargo transport available to both individuals and companies, ranging from a package delivery service used to move products from companies to end consumers to a shipping service which carries entire containers of products from one port to another.

They have many option to delivery the item such like by aircraft, ship, train or any other vehicles. All will involve cost, insurance and services. So its is important to choose the better transport to give the best services to customers. Because of Skynet is the fast courier they send item through aircraft (airlines) to international destination to make sure the item deliver as fast as possible.

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However the shipment to international destination are arrange by Skynets affiliance, DPEX Worldwide.

9.5.

Transportation

Transport Functionality Transportation is one of the most visible elements of logistics operations. Transportation provides 2 major functions: product movement & product storage.

Product Movement Whether the product is in the form of materials, components, assemblies, work-inprocess, or finished goods, transportation is necessary to move it to the next stage of the manufacturing process or physically closer to the ultimate consumer. A primary transportation function of product movement is moving up and down the value chain. Since transportation utilizes temporal, financial, and environmental resources, it is important that items be moved only when it truly enhances the product value.

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Product Storage

Skynet uses all the modes of transportations that is


airways roadways waterways rail freight Skynet has three international-bound air line-haul for all international shipments to Singapore and the rest of the world & 546 vehicles on the road. Depending upon the final destination where the goods have to finally reach and the type of package the customer has paid for, Skynet uses the individual modes of transport or a combination of either of these or all. Once again the geographical location and how fast the goods have to be delivered are the factors for the final selection of modes of transportation. The concept of economies of scale and economies of distance are both taken into consideration in case of larger consignments where Skynet provides an appropriate logistical solution which helps in reducing the overall cost for the customers.

9.6.

Process of Delivery Goods To delivery goods (parcel, Package and documents),its involve so many process. the involving process of delivery of goods for domestics are different

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from Process of delivery goods toInternational destinations. Here are some process involve at Skynet in delivery goods (parcel, Package and documents): Domestics:

International Destination: (DPEX)

9.7.

Customs & tax Duties Customs requirements are specific to each destination country. We can arrange all the paperwork necessary to achieve the earliest and most streamlined

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Customs Clearance into the destination country. Its all part of our service commitment to you. Our service includes pick-up, re-packing (where requested), processing, air services, all airline charges and documentation fees, customs clearance (not including government duties and taxes). Government Duties tax charge and rules are different in each countries.

10.0. Financial 10.1. Payment to DPEX

10.2. Annual Report Skynet Annual Report show that, the sale of courier to International Destination has increase from 18% last year (2010) to 21% this year (2011). This is because mostly customers realize that Skynet offer the lowest rate comparing than other courier company such like DHL, Fedex, UPS and others. This is biggest factors, why the sell of international shipment has increase.

10.3. Risk of Delivery In Courier industry, they have some risks in shipment/delivery goods, which are: Time- Late shipment Cost involving if the delivery shipment are in small quantities so this will effect the cost of transport. 10.4. Risks of Currency Exchange Currency risk or exchange rate risk is a form of financial risk that arises from the potential change in the exchange rate of one currency in relation to another.

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Investors or businesses face an exchange rate risk when they have assets or operations across national borders or if they have loans or borrowings in a foreign currency. An exchange rate risk can result in an exchange gain as well as a loss. So, The risk that the return on an investment may be reduced or eliminated because of a change in the exchange rate of two currencies. In Business like partnership or affilities in courier industry also may have risk in currency exchange. Because in affilities or partnership with courier service in another countries have to pay in US dollar or Sterling pound, so because of US and Sterling pound are not stable everytime will effect in your payment to courier partner or affilities. The export and import activities require uses of foreign currencies If an export/import company conducts business in a volatile market, it is exposed to a higher degree of currency rate risk. Sudden changes can be disastrous for a company that does not plan ahead by detracting from its bottom line. Types of currency risk There are two basic types of currency risk: Transaction risk is the risk that an exchange rate will change unfavourably over time. Translation risk is an accounting concept. It is proportional to the amount of assets held in foreign currencies. Changes in the exchange rate over time will render a report inaccurate, and so assets are usually balanced by borrowings in that currency. A currency risk exists regardless of whether investors invest domestically or abroad. If they invest in the home country, and the home currency devalues, investors have lost money

11.0. Competitive Advantage


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Skynet Worldwide (M) Sdn Bhd sustainable competitive advantages are as follows : Leading domestic courier companies in Malaysia with more than 80 branches located strategically throughout the country and a strong alliance with DPEX Worldwide (HQ in Singapore) which covers more than 150 countries across the globe. Skillful and trained labour IT empolyees/ Staffs from India whose specialize in IT Wide Network Coverage Up to 80 Network stations with extended hours terminal-based outlets designed to facilitate your customers demand. High Quality Customer Service Friendly local service provided by fully trained and equipped customer care consultants. A team of customer service offices are equipped to further support your customers query. Proven Business Process Smooth processing operation 6 days a week. Highly integrated operating environment Skynet offers ideal integration of its network system services into your existing IT infrastructure leveraging on the existing operating environment of the company. Skynet have a group of well-experienced professionals dedicated in one stop centre solution consultation, implementation, operation and support for our entire partner.
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Capable in handling large transaction or bulk transportations timely commitment Lowest Rates than others courier service Fastest service in all location in malaysia Many Loyalty customer who can promote or recommend Skynet to thiers friends 546 vehicles on the road

These are the tools for enhancing productivity and creating value for customers, and strategies to help Skynet valued customers in gaining advantage all over Malaysia. Skynet definitely has the capacity and capability to be a potential service provider company to undertake a scope of work as per term and requirement by customer.

12.0. Conclusion Skynet always focus on customer satisfaction through theirs fast & best services to thier customers. To acheive this all the systematic and effectiveness operation in Skynet is play the most important part. Through good and fast services and lowest rates can guarantee the customers satsfaction. In positive way this is best strategy to attrack more customers in couriers industry. For international shipment, Skynet Worldwide (M) Sdn Bhd Forming strong strategic alliances with DPEX Worldwide Pte. Ltd. (HQ in Singapore) which covers more than 150 countries across the globe Is Skynets competitive advantage in developing in international market not just regionally.
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In process of delivery of goods/package/documents from sender to receiver for international shipment, involve so many process such like how goods/package will processing in logistics, warehouse, depot, cargo, then how Skynet manage the transportation for delivery the goods/package to international destination. During process delivery goods/package(International shipment) also invloving insurance coverage of packages/goods,and customs & tax duties. Also involving risks in process of delivery goods such like risk of delivery low quantities which will effect on cost of transportation, and risk of currency exchange which Skynet have to pay to Skynets affilities/Partner, DPEX Worldwide Pte. Ltd.in US Dollar or Singaporean dollar. Finally, is it important to courier services company operating systematiclly to make sure they are the leading comparing than thier comptitors, and also important to know what are process of delivery of goods involvong for

international shipment, to find the best way to all operate smoothly in lowest cost and best services providing to customers. Because lowest rates and fast services is the major strategy to attract customers in courier industry.

13.0. Reference 1. www.Skynet.com.my 2. Ball/ Geringer/ Minor/ McNett: International Business 12edition: McGraw Hill International Edition Text Book

14.0. Attachment

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