Financial Feasibility Study of Investment in Customs Tracking System through e-Lock Technology in Customs Free Zone

Abstract

This study investigated the use of tracking system under the e-lock technology in the customs clearance in the free zone in order to evaluate the possibility for the investment in the construction of such system. The project worthiness assessment and sensitivity analysis were employed in the evaluation, and the criteria included discounted payback period, net present value, and internal rate of return. The data were collected from a private company which piloted the tracking system along with the Thai Customs Department during January – December 2019.

The project duration is 10 years, it was found that the tracking system under the e-lock technology was worth investing when two criteria, i.e. the decision-making standard and the expected decision making, were considered. Discounted payback period is 1 year and 5 months, Net present value is 6,535,767 baht and Internal rate of return is 71.07 percent. Furthermore, through the automation system, the system could reduce the operation time, increase the reliability, and enhance the continuity of the transfer of goods and products. Thus, this system could be employed as a tool to increase the competitive ability. It could serve customers’ needs as well as decrease the operator’s cost effectively.

This study utilized the project sensitivity analysis for investigating conditions that are still able to maintain the expected worth of investment. Case of increased cost but unchanged benefit, it found that the cost should not increase more than 47 percent as forecasted cost. Case of unchanged cost but decreased benefit, it found that the number of shipment trips should be not less than 25 trips per day. Case of changed cost according to number of shipment trips, it found that the number of shipment trips should be not less than 22 trips per day.