Deliver - Exam 1

What is transportation?

Movement of goods from Point A → Point B.

4 goals of transportation?

Safely, on time, good condition, cost effectively.

What is logistics?

Movement + storage of goods.

What is Supply Chain Management?

End-to-end strategic coordination. (logistics +transport)

What is the Deliver function?

Moving products where/when needed.

What utility does transportation create?

Time + place utility.

What is warehousing?

Storing products until needed.

What is a Distribution Center (DC)?

Strategic product positioning.

What is a Fulfillment Center (FC)?

E-commerce order processing.

What is cross-docking?

Minimal storage + rapid transfer.

What is cold storage?

Temperature-controlled storage.

What is distribution?

Coordinated movement of goods from source → destination.

What does distribution involve?

Transportation, warehousing, inventory, order processing.

How can distribution create competitive advantage?

Speed, reliability, visibility. — connect demand + time/place

What product characteristics affect logistics?

Volume/weight, fragility, shelf life, value density.

How does high volume/weight affect logistics?

Higher transportation cost.

How does fragility affect logistics?

Special packaging + handling.

How does short shelf life affect logistics?

Faster transport + more stocking points.

What is high cube, low weight?

Large + light.

What drives shipping cost for low cube, high weight?

weight

What is the main concern with low cube, low weight products?

theft/ security - higher value items: jewerly/phones

What is flat-pack design?

Disassembled design that reduces volume. - ikea

 How does flat-pack design reduce logistics costs?

More units/container → lower transport cost.

What are the 3 product classifications?

Convenience, Shopping, Specialty.

What are convenience goods?

Frequent purchase + little decision effort.

Distribution strategy for convenience goods?

 Many outlets + high service.

What are shopping goods?

Customers compare before buying.

Distribution strategy for shopping goods?

Fewer, selective outlets.

What are specialty goods?

Unique/brand-specific products.

Distribution strategy for specialty goods?

Limited, exclusive outlets.

4 product life cycle stages?

Introduction → Growth → Maturity → Decline.

Distribution strategy during Introduction?

Limited outlets; unpredictable demand.

Distribution strategy during Growth?

Expand outlets as demand rises.

Distribution strategy during Maturity?

Widest distribution + efficiency.

Distribution strategy during Decline?

Fewer stocking points + cost efficiency.

What is the 80-20 principle?

A products ~80% of sales come from ~20% of products.

Distribution strategy for A items?

Widest distribution + highest stock + frequent replenishment.

What are B items?

Next 30% → ~15% of sales.

Distribution strategy for B items?

Fewer outlets + moderate stock.

What are C items?

Bottom 50% → ~5% of sales.

Distribution strategy for C items?

Centralized + low inventory + minimal attention

nearshoring?

Moving production closer to markets.

reshoring?

Moving production back to the home country.

How does globalization affect transportation?

More distant suppliers + global customers = greater complexity.

What is needed for cross-border transportation?

Documentation + customs + regulatory knowledge.

How does population growth/urbanization drive trade?

Dense cities → greater transportation needs.

How does technology drive trade?

Digital platforms, IoT, automation → efficiency + transparency

How do trade agreements affect transportation?

Shape trade flows + investment.

Ocean Freight - % and best

70%- bulk commodities and large shipment

Road Freight- % and best

18%- flexible/ short haul - last mile delivery

Rail-Freight- % and best

9% - bulk inland transport over long distance

Inland Waterways- % and best

2%

Air Freight - % and best

.25% - high value + time- sensitive

Air freight Dis/Advantage

advantage: fastest, minimal handling (damage), extensive coverage, highest security

disadvantage: 10-20x $ than ocean, limited capacity, highest CO2, weight restriction

Ocean Freight Dis/Advantage

Advantage: lowest $ per unit, massive capacity, scale for bulk goods- best fuel efficiency per mile, lower CO2

Disadvantage: 2-8 w time, port congestion, weather delay, higher inventory carrying cost

Road Dis/Advantage

Advantage: flexibility with door-2- door capabilities, extensive networks- rapid deployment- min. infrastructure

Disadvantage: driver shortage, traffic congestion, fuel $ volatility, weather, higher CO2

Rail Dis/Advantage

Advantage: 280 trucks in one, highly fuel efficient, reliable schedule (minimal delay), less affected by weather

Disadvantage: fixed routes, last-mile require truck transfer, high capital investment, less competitive for short distance

Pipeline best

oil, natural gas and chemicals

Pipeline Dis/Advantages

Advantage: very low operational cost once established, 24/7 flow (min. labor), high secure (low theft, risk, damage)

Disadvantage: high construction cost, compatible commodities (liquid/gas) , fixed routes (min. flex)

Drayage definition

short distance trucking service, connects modes of transport - first and last mile

Multimodal Transport

1 carrier/contact takes liability across all transport modes- cargo may be transferred between containers

Intermodal Transport

same container in journey- multiple contracts with different carriers, minimal cargo handling between modes, min. damage risk

transload- intermodal

transfer load into another container

demurrage- rail yard/ port storage fee

charged when container stays beyond allowed free time

detention- container usage fee

charged when keeping container/ not emptying outside terminal beyond allowed time