Transportation

Introduction When goods or the products are ready after labeling, pricing, packing and packaging etc. done, then these goods are sent to the transport company, which helps in supplying it to the customer through land, air or sea transportation. Thus transportation of goods or logistics is a key part of the Supply Chain Management. Transportation is a way of moving people or things from one place to another.

Types of Transportation Land Water Air

Transport Functionality & Principles It is one of the most visible elements of logistics operations. As consumers, we are accustomed to seeing trucks and trains moving products or parked at a distribution facility.

Transport Functionality It provides two major functions Product movement Product Storage Product Movement Whether the products is in the form of materials, components, assemblies, work-in- process, or finished goods, transportation is necessary to move it to the next stage of the manufacturing process or physically closer to the ultimate customer.

A primary transportation function is product movement up and down the value chain. Transportation utilizes temporal, financial and environmental resources, it is important that items be moved only when it truly enhances product value. The major objective is to move product from an origin location to a prescribed destination while minimizing temporal, financial and environmental resources costs. Loss and damage expenses must also be minimized. The movement must takes place in a manner that meets customer demands regarding delivery performance and shipment information aviability

Product Storage- A less common transportation function is temporary storage. Vehicles makes rather expensive storage facilities. if the in-transit product requires storage but will be moved again shortly (in few days), the cost of unloading and reloading the product in a warehouse may exceed the profitability.

Principles Economy of scale It refers to characteristic that transportation cost per unit of weight decreases when the size of the shipment increases. The larger the capacity transportation vehicles such as rail or water are less expensive per unit of weight than smaller capacity vehicles such as motor or air.

Economy of distance It refers to the characteristic that transportation cost per unit of distance decreases as distance increases. Eg-a shipment of 800 miles will cost less than two shipments of 400 miles.

Participants in Transportation Decisions Public Government Shipper Consignee (Receiver) Carrier

Modal Comparison and Dominant Traffic Composition Mode Nature of traffic composition Rail Extracting industries, heavy manufacturing, Agricultural Commodities Highway Medium and light manufacturing, Distribution between wholesalers and retailers Water Mining and basic bulk commodities, chemicals, cement, some agricultural products Pipeline Petroleum, coal slurry, no particular commodity Air Emergency rather than regular basis.

Legal Classification of Carrier Common Carrier Contract Carriers Private carriers

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