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Name of Institution
Submitted By:
Ruchi Tyagi
Karan Aditya Abrol
Mehul Srivastava
Saurabh Sharma
Shurid Sarkar
Piyush Jagwani
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INTRODUCTION Name of Institution
• Transportation :- Transport or transportation is the movement of people
and goods from one location to another.
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Relationship of Transportation to other
business function
Traffic Management and Transportation.
Purchasing.
Customer Service.
Product Pricing.
Distribution Locations
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Transportation Infrastructure
Transportation is a visible element of logistics. Consumers are accustomed to
seeing trucks and train transporting products or parked at business facilities.
• Transportation Functionality :-
a). Product Movement :-
Basic value is to move inventory to a specified destination.
Financial Resources ex. 60% of U.S total logistics cost is related to transportation.
Environment Resources
- largest consumer of fuel and oil.
- air pollution and noise pollution.
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• According to the
investigation of National
Council of Physical
Distribution Management
(NCPDM) in 1988, the cost
of transportation, on
average, accounted for
6.5% of market revenue
and 44% of logistics costs.
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The Effects of Transportation
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on Logistics Activities
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The Role of Transportation in Service
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Quality
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Transportation Principles Name of Institution
• Economy of Scale :-
The more items (weights) is transported, the less the transportation
costs per item (unit of weights)
$ 100 / good
Transportation
cost per good
$ 10 /good
i le
0 /m
Transportatio $.1 $.05/mile
n Cost per
Mile
Tapering Principle
$50/mile
Examples- Public airlines, railroads, bus lines, cruise ships etc. operate as common
carriers
• Contract Carriers:
These are similar to common carriers but instead of serving to general public, they
provide transport services for a negotiated price to selected customers, defined by
contract agreement. Normally contract carrier rates are less than common carrier
rates. They allow shippers greater control over the transportation resources.
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• Private Carriers:
It is wholly owned or leased by the firm, and is incidental to a company’s
main line of business. Wholly owned transport provides great deal of
flexibility and economy.
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Non Operating Intermediaries
• Freight Forwarders:
They are for profit businesses that consolidates small
shipments from various customers into a bulk shipment
and then utilize a common surface or air carrier for
transport.
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Advantages:
• Lower Rate
• Faster transport of small shipments
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• Shipper association:
Shippers associations are operationally similar to freight
forwarders. They are voluntary non profit entities where members,
operating in a specific industry collaborate to gain economies
related to small shipment purchases.
• Brokers:
Transport brokers are agents that brings shippers and carriers
together by providing timely information about rates , routes and
capacities. They may arrange transportation but assume no liability
for it.
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Transportation StructureName of Institution
• Transport is performed by modes, such as air, rail, road, water, cable, pipeline
and space.
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Water :-
Oldest mode of transport.
moderate fixed costs (ships and freight handling equipment)
low variable costs (labor, fuel)
Main adv. Of water transport is the capacity to transport extremely large
shipments.
Main disadvantage is slow speed and limited range of operation.
Slow transit time provides a form of storage in transit that can benefit logistic sys.
Design.
Air :-
Least utilized mode of transport because of limited load size and weight lift
capacity
. Fixed cost is lower than rail or road or pipeline. But operating costs are highest.
Main adv. lies in SPEED this allows other aspects of logistics like warehousing
and inventory to be reduced or eliminated.
Premium air carriers such as Federal Express, DHL Express etc provides
airfreight services.
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• Rail Transport :-
high fixed costs (land, tracks) & low variable costs (labor, fuel)
Improving flexibility
Intermodal services
• Road Transport :-
Mostly used mode
low fixed costs (government builds, maintain Roads) & medium-high
variable costs (labor, fuel)
Flexible
Trucks go door to door as opposed to planes and trains.
Irrespective of the mode chosen ultimately the consignment reaches the
doorsteps of the customer by road.
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Pipeline.
Highest fixed costs (right of way & construction costs of equipment) & lowest variable
costs (no labor or fuel)
Slow and dependable
Low energy consumption.
Pipe line operates all the time except when it is shut down for maintainance.
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Intermodal Transportation
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CASE STUDY
TRANSPORTATION MANAGEMENT
OUTSOURCE SOLUTION
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Summary Name of Institution
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Challenges Name of Institution
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Solution Name of Institution
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Results
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