Transportation Management

Transportation Management It is used for better movement of goods

from one location to another location.

Objective of logistics and supply chain management is to make available the right quantity of right product at the right time and place at least cost.

Share of transportation cost is 40% of total logistics cost.

Cont… Rapid innovation in the field of

information and communication technologies, their has been a phenomenal growth in E-commerce and online selling which need more specific and value-added transportation services like tracking of shipment, in order to meet delivery commitment.

Mode of Transport

1) Airways2) Seaways3) Railways4) Roadways

Airways

Goods are transported by air. Prefer for perishable goods or for

emergency services. Quick delivery of product. Cost is very high.

Seaways

Goods are transported through the water medium by ship.

Used for foreign trade.

This mode has acquired for cheapest, having a larger capacity and flexibility

Railways

To efficiently transport large quantities of goods over long distance

Tariff of railways is very low, which encourage large shipment for longer distance, product like fertiliser, cement, food grains and petroleum product.

Roadways The reliability and economy of this mode is

gradually increasing due to continuous improvement in the quality of motor vehicles and the condition of road.

This mode used by supplier to deliver goods in a cost effective manner and best suited for short distance.

Average damage is the matter of negative marks in this mode. For example - infrastructure and professional.

Multi – Model Transport Multi-modal transport is defined as the

carriage of goods by at least two different mode of transport on the basis of some mutually agreed contract to ship product from one place to another place.

Multi-model transport, an old concept is a term used to describe the linking of transport responsibilities, documentation and liability in the movement of goods.

Frame work of Multi-mode Transport

RAIL ROADS WATER AIR

Piggyback Fishy back Tranship Air truck

RAIL ROADS WATER AIR

Piggyback Fishy back Tranship Air truck

RAIL ROADS WATER AIR

Piggyback Fishy back Tranship Air truck

Functional requirement and transportation

Functional Req. Location Preferred mode

Production scheduling

Vendor to plant Rail / Road

Balancing stock Warehouse to warehouse

Road

Distribution service Warehouse to customer

Road

Export / import Country to country Sea / Air

Emergency service Plant to customer Air

Selection of transportation mode

The strengths and weakness of the firm in term of financial and production resources.

Market information including the competitive scenario, geographical structure.

Product features and suitability to various modes of transportation such as Weight, size, shape.

Cont…

Quantity to be transported each time. Distance to be covered. Total transportation cost of various

mode of transportation. Carrier performance in term of speed,

availability, frequency, reliability and safety.

Transportation Network Transportation network is a

development of shipment plan focusing on the maximisation of vehicle utilisation and cost efficiency.

This planning must address customer order, availability of transport resources, the volume of product to be shipped, geographical location and cost of transportation.

Transportation network design

Plant 1 customer 1

Plant 2 customer 2

Elimination of warehousing infrastructural facilities.

High degree of coordination between supplier and customer.

This is used by only company (cement, fertiliser) who has customer near to production plant.

Direct shipment network

Direct shipment VIA Distribution center

Plant 1

Plant 2

Distribution Center

Customer A

Customer B

Customer BPlant 3

Lower plant to warehouse transportation cost by bulk transportation

Better customer service by lowering inventory requirement at customer’s end resulting into better return to them.

Higher logistical cost due to inventory carrying cost

Warehouse Management

Warehouse Warehouse are the space for keeping

and storing goods in scientific and systematic manner to maintain their value, quality and usefulness.

It served as a static unit in the material and product pipeline, necessary to match products in a timing sense with consumers.

Cont… In logistics and SCM perspective, the role of

the warehouse is more as a switching facility and less as a storage facility.

Warehouse is expected to provide superior logistical customer service in terms of regular availability of product, zero defect delivery, information sharing, consistency and reliability of services.

Function of warehouse

Function of warehousing can be properly discussed in two heads, namely,

1) Economic function

2) Operational function

Economic functions

Consolidation

Break-Bulk

Stockpiling

Value-added service

Operational functions

Receiving of goods Up-to-date recording of goods showing

stock position Storing of goods at an appropriate place

and in minimum area. Proper handling of goods, especially loading

and unloading Order receiving, processing. Dispatching of goods Preparation of goods

Types of warehouse On the basis of ownership

1) Private warehouse2) Public warehouse

On the basis of service

1) Bonded warehouse2) Field warehouse3) Cold storage4) Distribution warehouse5) Export and import warehouse

Factor for the selection of number and location of warehouse

Number of geographical location of the market targeted by the firm.

Location and facilities of the production centers.

Transportation infrastructure facilities Nature, quality and quantity of goods

to be stored Availability of financial resources Management philosophy

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