第二章Transportation.pptVIP

Chapter 2 Transportation Text A Introduction to transport Transportation refers to the movement of product from one location to another as it makes its way from the beginning of a supply chain to the customers hands.[1] 1. Transport Functionality Transportation enterprises provide two major services: product movement and product storage. Product Movement Whether in the form of materials, components, work-in-process, or finished goods, the basic value provided by transportation is to move inventory to the next stage of the business process. The primary transportation value proposition is product movement up and down the supply chain . The performance of transportation is vital to procurement, manufacturing, and market distribution. Transportation also plays a key role in the performance of reverse logistics. Without reliable transportation, most commercial activity could not function[2] Transportation consumes time, financial, and environmental resources[ Product Storage A less visible aspect of transportation is product storage. While a product is in a transportation vehicle, it is being stored. Transport vehicles can also be used for product storage at shipment origin or destination, but they are comparatively expensive storage facilities. Since the main value proposition of transportation is movement, a vehicle committed to storage is not otherwise available for transport. A trade-off exists between using a transportation vehicle versus temporarily placing products in a warehouse If the inventory involved is scheduled to move within a few days to a different location, the cost of unloading, warehousing, and reloading die product may exceed the temporary charge of using the transportation vehicle for storage[3] . Another form of temporary product storage is diversion. Diversion occurs when a shipment destination is changed while product is in transit. So although costly, product storage in transportation vehicles may be justified from a tota