A Framework for the Selection of an Optimal Custom House Agent by Exim Firms Using the Analytic Hierarchy Process

A Framework for the Selection of an Optimal Custom House Agent by Exim Firms Using the Analytic Hierarchy Process
V Kannan*
This paper aims at providing a framework to exim firms for the selection of an optimal Custom House Agent (CHA) by using the Analytic Hierarchy Process (AHP). For the study, two focus groups were conducted. One for exploring the criteria which contribute to the selection of an optimal CHA and the other for bringing out the relative importance of these criteria. The moderators of the focus groups were selected by using judgment sampling and the members by quota sampling and snowball sampling. On analysis, it was first found that Service Charge (SC) is the most important criterion in the selection process and Updated Knowledge (UK) is the least important criterion. Then, three decision choices (CHA X, Y and Z) were assumed for illustrative purpose and how the optimal decision choice is selected by using AHP was explained in a step by step manner. This paper has not incorporated the Consistency Ratio (CR). It is concluded that in real life situations, the exim firms shall select the optimal CHA with ease by applying this framework based on AHP.

Introduction
Exim firms often face the problem of how to select the optimal CHA for clearing their export/import goods from customs. This is a vital decision because delay in customs clearance will halt the goods at port and thus the goods will lose their time utility. An optimal CHA will ensure timely clearance of goods from customs and thus contribute to the time utility of the same. In some countries, CHAs are called as Customs Brokers. The secondary data collected from Indian custom houses show that more than 75% of the export and import goods are cleared from customs by CHAs and less than 25% is cleared by exim firms themselves. It is also ratified by Gutierrez et al. (2005) at the international level. They report that the vast majority of formal import entries in several trade-intensive

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