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Business Logistics Management

Business Logistics Management. 6. Transport Fundementals. Importance of an Effective Transportation System. Greater competition Economics of scale Reduced prices. Greater Competition. Economics of Scale. Reduced Prices. Service Choice and their Characteristics. Service choice

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Business Logistics Management

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  1. Business Logistics Management 6. Transport Fundementals

  2. Importance of an Effective Transportation System • Greater competition • Economics of scale • Reduced prices

  3. Greater Competition

  4. Economics of Scale

  5. Reduced Prices

  6. Service Choice and their Characteristics • Service choice • Rail, Trunk, Water, Pipe, Air • Price • Transit time • Variability • Loss and damage

  7. Price

  8. Transit Time

  9. Variability • Weather • Traffic congestion • Number of stops • Consolidate shipments

  10. Single Service Choice • Rail • Truck • Air • Water • Pipeline

  11. Rail • Mid- hauler – 720 miles • Slow mover – 22mile/hr • Low/Mid-valued products - material • CL and LCL • Mid-shipment • Variability is low

  12. Truck • Short hauler – 274-646 miles • Fast mover – 60-80 mile/hr • Mid- valued products – semifinished or finished products • TL and LTL • Small shipment • Variability is low • Door to door service

  13. Air • Very long hauler – 1300 miles • Very fast mover – 600 mile/hr • High- valued products –products with high time constraints • Mid- shipment • Variability is high

  14. Water • Mid/Long hauler – 550-1775 miles • Mid- mover – 50-70 mile/hr • Mid- valued products –products with low time constraints • Very large shipment • Variability is middle

  15. Pipeline • Long hauler • Very slow mover – 3-4 mile/hr • Very low- valued products – material • Large shipment • Variability is very low

  16. Intermodal Service • Rail and Trunk • Rail and Water • Rail and Air • Rail and Pipeline • Truck and Air • Truck and Water • Truck and Pipeline • Water and Pipeline • Water and Air • Truck and Water

  17. Trailer and Flatcar

  18. Containerized Freight

  19. Agencies and Small Shipment Services • Freight forwarders • Shipper`s association • Transport brokers

  20. International Transportation • Physical plant

  21. Agencies and Services

  22. Transport Cost Characteristics • Variable and Fixed Costs • Distance and Volume • Common or Joint Costs

  23. Variable and Fixed Costs

  24. Cost Characteristics by Mode • Rail • Water • Air • Pipeline

  25. Rail

  26. Pipeline

  27. Rate Profiles • Volume related rates • Distance related rates • Uniform, Proportional, Tapering, Blanket • Demand related rates

  28. Uniform

  29. Proportional

  30. Tapering

  31. Blanket

  32. Demand Related Rates

  33. Line-haul Rates • By product

  34. Class Rates • By shipment size

  35. Other Incentive Rates • By Route • Miscellaneous Rates • Cube Rates • Import-Export Rates • Deferred Rates • Released Value Rates • Ocean Freight Rates

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