Cost Accounting of Gearbulk

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Contents
Executive summary2
Industry analysis………………………………………………………………………………………………………………………….3 Major external environmental factors3
Money exchange………………………………………………………………………………………3 Economic situation……………………………………………………………………………………4 The politics……………………………………………………………………………………………4 Five forces…………………………………………………………………………………………………………………………...5 Main strategies…………………………………………………………………………………………………………………….6 Site visit and company report7

Value chain7
Research and development8
Production8
Marketing9
Distribution9
Customer service10
Corporate Social Responsibility10
Costing systems11
Recommendations13
Conclusion14
References15

Executive summary

Cost management is a critical technique to every business firm; the main issue for manager making decision is cost control and profit maximization. This report aims to analyze the different cost occur in a real business based on a case study of Gearbulk Australasia Pty Ltd such as costing systems and value chain. The main methodologies we used in this project are face to face interview of the company’s line manager who called Bryan. It provides us lots of insights of cost control and business management of the company.

Gearbulk Australasia Pty Ltd was founded in 1998 in Victoria, which provide door-to-door logistics to achieve worldwide distribution to customer. For the internal analysis, we found that Gearbulk is providing high quality transportation services for various industrial sectors and it is a medium shipping company in Australia. According to our research from IBISWorld, three major external environmental factors influencing industry change are identified: money exchange, economic situation and the politics. Facing the industry changes, Gearbulk Australasia Pty Ltd chooses cost leadership as its core competitive strategy.

Besides, our groups will analysis the processes of Gearbulk Australasia Pty Ltd value chain, including research and development, production, marketing, distribution customer service and corporate social responsibilities. In addition, the factors caused the costs change are then identified, followed by the analysis of the status quo of the company’s costing system, trying to find that whether it is useful for the decision making and the strategy direction for this company.

Based on analysis, three recommendations are suggested for the future development of Gearbulk Australasia Pty Ltd: 1. Changing costing systems
2. Sustainable development

Industry analysis
Gearbulk Australasia Pty Ltd is a private company categorized under Freight-Traffic Managers and located in Port Melbourne, VIC, Australia. It was established in 1968 and providing high quality transportation services for various industrial sectors. The company operates the world's largest fleet of open hatch gantry craned vessels as well as open hatch jib craned vessels, specifically designed and equipped to transport unitized cargoes such as forest products, non-ferrous metals and steel. Gearbulk is also involved in the transportation of conventional bulk cargoes and in terminal operations.

According to database IBIS World, Gearbulk should be operating in the industry named INTERNATIONAL SEA TRANSPORT IN AUSTRALIA. This industry has a medium level of industry concentration, with the top four players estimated to account for about 66% of industry revenue.

In Australia, Gearbulk Australasia Pty Ltd merely operates two routes among Asian (China, Japan and Korea), New Zealand and Australia. Therefore, according to the level of industry concentration and the route, Gearbulk Australasia Pty Ltd merely is a medium shipping company in Australia.

Major external environment factors
The operation of Gearbulk is to transport unitized cargoes, such as forest products and non-ferrous metals between Australia and Asia, which means this operation closely depends on the situation of the...
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