Logistics and Transportation Chapter 14

Distribution Cont’d

Logistics The movement of a product through the channels of distribution.

4 Factors to consider in determining transportation: 1.Destination (distance): within a city vs. across cities; domestic vs. international 2.Weight: will affect cost! 3.Volume: can freight containers be used? 4.Type of goods: special handling or containers may be necessary These 4 factors contribute to the overall cost of transportation.

Methods of Transportation (pg )

What are the advantages and disadvantages of each method? What types of products would be used for each method of transportation?

Brainstorm! Create a chart in your notes and brainstorm with your partner to fill it in. Transport ModeAdvantagesDisadvantagesProduct Examples Trucks Trains Planes Ships Pipelines

Transportation Methods Mode of Delivery AdvantagesDisadvantages Trucks door to door delivery Can be modified for specific goods Inexpensive slower than other methods Can be slowed by weather, traffic or maintenance Trains can move large quantities over long distances Relatively low cost Railroad cars can be modified for specific types of goods special containers allow for direct transfer of goods from one form of transportation to another (intermodal) which reduces costs and potential shipping damage No destination flexibility; can only go where tracks go might have to combine this method with trucking to get the goods delivered more expensive than trucking

Transportation Methods Mode of Delivery AdvantagesDisadvantages Planes speed of delivery international shipments Good for high value, low weight items and perishable goods Cost can offset inventory (storage) costs Most expensive Another mode must be used to get the goods delivered to final destination Ships can move large quantities at once less expensive than planes for international shipments special containers allow for direct transfer of goods from one form of transportation to another (intermodal) which reduces costs and potential shipping damage Must combine this method with trucking to get the goods delivered Pipelines can carry large amounts of liquid or gas products Product safe from damage or theft Low operating cost Only a few types of products Expensive to build Leaks are rare, but can cause great damage to environment

Free on Board (F.O.B): The point at which the seller’s responsibility for goods in shipment ends and the buyer’s responsibility for the goods begins

Airport Codes! Can you match the code with the correct Canadian city? 1.YEG 2.YYZ 3.YVR 4.YQR 5.YHM 6.YQT 7.YYC 8.YOW 9.YHZ 10.YQM 11.YUL 12.YXE 13.YWG