SCM 4003 exam 2

what is the the relationship between rate charge and distance?

usually, as distance increases so does the rate

what is the difference between linear charging and volumetric charging

Linear charging: charging for freight based on distance

Volumetric charging: charging for freight based on the dimensions of the consignment. Usually used for bulky or difficult-to-handle shipments

diferent modes of transportations and their fixed and variable costs?

- road: fixed cost is low and variable cost is medium

- rail: fixed cost is high and variable cost is relatively low

- air: fixed cost is on the lower side but high variable cost

- water: fixed cost is on the medium side and variable cost is low

- pipeline: fixed cost is high and variable costs are low

what is factory gate pricing

the use of an ex-works price for a product plus the organization and optimisation of transport by the purchaser to th point of delivery

what does derived demand mean?

the fact that people or freight do not travel for the sake of making a journey, they travel for some other reason

new emerging types of transport? or new routing?

the northern sea route is a new route emerging because of the melting arctic ice.

what is containerziation?

- usually refers to LoLo

- a method of transporting goods by using standardized shipping containers to move freight between different modes of transportation

LoLo vs RoRo(what is the advantages and disadvantges)

- LoLo: Lift-on/lift-off; advantages: units have to be lifted by crane, but boxes can be stacked one on top of the other; also it's cheaper than RoRo

- RoRo: Roll-on/roll-off; advantages: flexibility- the tractor unit attaches to the trailer and it can drive away

what is a TEU

Twenty-foot equivalent units = what container capacity is expressed in

what is the design of the shipping network?

- the container shipping lines often design their networks

- container shipping lines have to carefully plan their allocations of containers to the various port pairs

- hub-and-spoke network designs(as well as point-to-point) are quite prevalent in the world's container shipping networks

what are strings?(be able to exaplin it)

- a vessel will call to multiple ports on a continuing rotation- these are referred to as strings

- Supply chain strings refer to interconnected stages and entities involved in the production and delivery of goods.

what is the tare weight

refers to the weight of the empty container

what does groupage mean

- also known as consolidated shipment

- when you combine smaller shipments from various consignors into one single load

according to the book, what is the percentage of the world's total freight in tons/kilometers carried by sea?

70%

What does FCL and LCL mean?

FCL: full container load

LCL: Less than full container load

What is the difference between a freight forwarder and own account transportation/consignee transportation?

- freight forwarders: are just like travel agents except that they arrange transport for freight, not people

- own-account transportation: when a company provides its own transport services

- the difference is that with own-account transportation the company buying the goods arranges the transport and with freight forwarder a 3rd party arranges the transportation

What is a freight forwarder?

are just like travel agents except that they arrange transport for freight, not people

what is an integrator

they offer a seamless/integrated end-to-end service from consignor to consignee

3PL

LSPs that provide multiple logistics services, often in an integrated fashion

4PL

- invented and trademarked by Accenture in 1996

- defined as ' a supply chain integrator that assembles and manages the resources, capabilities, and technology of its own organizations, with those of complementary service providers. to deliver a comprehensive supply chain solution'

5PL

LSPs who use technology solutions across complex networks that incorporate multiple supply chains

What is the difference point-to-point vs a hub and spoke

- point-to-point is services between all city pairs, direct routes between locations

- hub-and-spoke networks operate on the simple, but highly effective, principle whereby freight is shipped from all origin points to a central hub, re-sorted, and then shipped out to the destination

What is an incoterm? What does it stand for?

- Incoterms stands for international commercial terms that are now commonly accepted standards in global trade

- these standards determine who is responsible for the freight depending on what stage it is at during transportation

Bill of lading

the document that typically cintains all requisite information

what is the most important document in a international transaction

the bill of lading

what is a letter of inquiry

- a document including the terms of interest and a request for a quote

- can aslo be "a request for information about the shipping of a product, such as the shipping date and time"

every year the world bank publishes what kind of report

The World Bank publishes the Doing business report which includes analysis of the ability to trade across borders (measured by way of the time and cost associated with exporting and importing a standardised cargo of goods by sea

what is the trade faciliation agreement?

- This agreement, under the World Trade Organization, aims to reduce trade barriers by simplifying customs procedures

- this agreement contains provisions for expediting the movement, release, and clearance of goods, as well as for improving cooperation between customs and other agencies on trade facilitation and other customs compliance matters

what are the two main critical variables in trade facilitation agreements? (to increase trade facilitation we look at what two main things?)

time and cost

does electronically exhcnage infomation improve trade facilitation

yes, the ability to electronically exchange information is a key element to improve trade facilitation. countries around the world are implementing web-based systems to allow traders to submit relevant documents and even pay duties remotely, thus saving them time and money and reducing the complexity of border requirements

what does single window mean

a single window is an electronic portal through which all relevant transport, customs and other documentation can be lodged and to which all relevant stakeholders can have access

what is blockchain

blockchain is a distributed ledger technology where all the information shared in the network is stored in each node, therefore making it easier to access and trace transaction history

does blockchain help facilitate bitcoin

Blockchain does help facilitate Bitcoin. Because of Blockchain, bitcoin has become a secure form of cryptocurrency available for all to use

what is a commodity supercyle

A supercycle is a long period of strong economic growth, where demand for goods and materials like metals and plastic is higher than what companies can produce. This high demand helps boost stock prices and usually means the economy is growing steadily for a long time, especially in areas like commodities(raw materials)

china's slowdown, what is the impact of this?

Since people are losing their jobs because of factories closing global trade as a whole has been affected all around the world. The US will suffer complications from China if they continue at this rate. With the Chinese economy slowing down, the demand for goods from other countries will also slow down. Currently, the US exports 150 billion dollars worth to China and China exports 536 billion dollars worth of goods to the US. This negatively affects the US' income since China no longer needs these goods since the demand is no longer there. A decline in the Chinese economy means that their currency, the Yuan will depreciate. When the US dollar is more expensive,then goods from the US will be less competitive. With cheaper goods from China, the US loses some of its market share.