Lesson 6 Flashcards
the largest expenditure in logistics (60% of total logistics spend)
transportation
who are responsible for moving inventory around a firm’s supply chain?
transportation managers
this helps a firm provide service and reduce cost, inventory, storage, and materials handling
transportation
what could be a MAJOR BARRIER to a successful supply chain when not managed effectively and efficiently?
transportation
2 main functions of transportation functionality
product movement
product storage
movement of inventory to specified destinations
product movement
occurs while product is in transit or waiting to be moved or unloaded
product storage
this element is in-transit inventory is “captive”, usually inaccessible during transpo
restrictive element under product movements
this element is where inventory can be diverted during shipment to a new destination
flexible element under product storage
who are the transportation participants
public
government
carrier and agents
IT
consignor (shipper)
consignee (receiver)
5 modes of transpo modal structure
rail
highway
water
pipeline
air
has declined by over half since 1970; composed of carload, intermodal, container
rail
spans over 32,000 km across all regions of PH with key benefits including speed of transit and ability to operate door-to-door
more efficient than rail for small shipments
truck (highway)
oldest model of transpo but ranks between rail and truck in terms of fixed cost
water
HIGHEST fixed cost but LOWEST variable cost of all modes; unique transpo mode
operates 24/7, no emissions, no empty container or vehicle to return
NOT FLEXIBLE THO, limited to liquids and gas
pipeline
least utilized but FASTEST among all modes
fixed cost = 2nd lowest; HIGH variable cost
high value, priority, and extreme “perishability”
air
combining the use of truck and rail
intermodal
best known and widely used intermodal
TOFC (trail on flat car) and COFC (container on flat car)
firms that do not own assets acting as a middleman between shippers and carriers
non-operating intermediaries
TRANSPO ECONOMICS AND PRICING
cost per unit weight ⬇️ as distance ⬆️
economy of distance
TRANSPO ECONOMICS AND PRICING
cost per unit weight ⬇️ as TOTAL WEIGHT ⬆️
economy of weight
TRANSPO ECONOMICS AND PRICING
cost per unit weight ⬇️ as the DENSITY OF SHIPMENT ⬆️
economy of density
TRANSPO ECONOMICS AND PRICING
cost per unit weight ⬇️ as the DENSITY OF SHIPMENT ⬆️
economy of density
exonomic drivers of rates
distance
weight
density
stowability
handling
liability
market
