Logistics, Trade Administration and Supply Chain

To date, pipeline transportation offers a very limited range of services and capabilities. The most economically feasible products to move by pipeline are crude oil and refine petroleum products. However, there are some experimentation with moving solid products suspended in liquid referred to as slurry or containing the solid products in cylinders that in turn move in a liquid within the pipe. If these innovations prove to be economical, pipeline service could be greatly expanded. Early experience with coal suspended in liquid has not been favourable because pipes have eroded. Product movement by pipeline is very slow, only about three to four miles per hour. This slowness is tempered by the fact that products move 24 hours a day, 7 days a week. This makes the effective speed much greater when compared with other modes. Pipelines capacity is high, considering that a 3 mph flow in a 12 inch diameter pipe can move 89,000 gallons per hour. Concerning transit time, pipeline service

Water transportation service is limited in scope for several reasons. Domestic water service is confined to the inland waterway system, which requires shippers to be located on the waterways or to use another transportation mode in combination with the water. In addition, water service on the average is slower than rail. Availability or dependability of water service are greatly influenced by the weather. Movement on the waterways during the winter is impossible and floods and droughts may also interrupt service at other times as well. There is tremendous capacity available in water carriers with barge tows up to 40,000 tons and there are individual barges with standardized dimensions of 26 by 175 feet and 35 by 195 feet. Capability and handling are being increased as barged carrying ships are being developed and such improvements as satellite navigation with radar, refined depth finders and auto piloting mean  around the clock service. Water services are provided in all legal f

Air transportation is being considered by increasing numbers of shippers for regular service, even though air freight rates exceed those of trucking by more than two times and those of rail by more than 16 times. The appeal for air transportation is its unmatched origin to destination speed, especially over long distances. Air service dependability and availability can be rated as good under normal operating conditions. Delivery time variability is low in absolute magnitude, even though air service is quite sensitive to mechanical breakdown, whether conditions and traffic congestions. Variability when compare with average delivery times, can rank air as one of the least reliable modes. The capability of air has been greatly constrained by the physical dimensions of the cargo space in the aircraft and the aircraft's lifting capacity. This is becoming less of a constraint, however, as larger aircraft are put into service. For example, jumbo airplanes such as Boeing 747 and L

Trucking moves freight with smaller average shipment size than rail. More than half of the shipments by truck are less than 10,000 pounds or LTL volume. The inherent advantages of trucking are its door-to-door [DTD] service, involving no loading or unloading between origin and destination as is often true of rail and air modes; its frequency and availability of service and its DTD speed and convenience. Truck and rail services show some distinct differences, even though they compete for many of the same product shipments. First, in addition to the common and private legal classification of carriers, trucking offers services as contract carrier as well. Contract carriers do not hire themselves out to service all shippers as do common carriers. Shippers enter into a contractual agreement to obtain service that better meets their particular needs and requirements without incurring the capital expense and administrative problems associated with private ownership of a trucking fleet.

The railroad is a long hauler and slow mover of raw materials [coal,lumber and chemicals] and of low-valued  manufactured products [food, paper and wood products] and prefers to move shipment sizes of at least a full carload. This relatively slow speed and short car distance travelled in a day reflect the fact that the majority of freight car time is spent on loading and unloading operations, moving from one place to another within terminals, classifying and assembling cars into trains or standing idle during seasonal slump in car demand. Rail service exist in two legal forms, common carrier or privately owned. A common carrier sells its transportation service to all shippers and it is guided by the economic and safety regulations of the appropriate government agencies. In contrast, private carriers are shipper owned with the usual intent of serving only the owner. Because of the limited scope of the private carrier's operations, no economic regulations are needed. Nearly all

The transportation user has a wide range of services at his or her disposal that revolve around the five basic modes: water, rail, truck, air and pipeline. A transport service is a set of performance characteristics purchased at a given price and the variety of transport service is almost limitless. The five modes may be used in combination e.g. piggyback or container movement; transportation agencies, shippers' association and brokers may be used to facilitate these services; small shipment carriers like, UPS or FEDEX may be used for their efficiency in handling small packages or a single transportation mode may be used exclusively. From among these service choices, the user selects a service or combination of services that provides the best balance between the quality of service offered and the cost of that service. The task of service-choice selection is not as forbidding as it first appears because circumstances surrounding a particular shipping situation often reduce the c

Transportation usually represents the most important single element in logistics cost for most firms. Freight movement has been observed to absorb between one-third and two-thirds of total logistics costs. Thus, the logistician needs a good understanding of transportation matters. Although a comprehensive discussion of transportation is not possible within the scope of this text, this subject highlights what is essential to the logistician for his or her managerial purpose. The focus is on the facilities and services that make up the transportation system and on the rates [costs] and performance of various transport service that a manager might select. Spefcifically, we wish to examine the characteristics of the transportation service alternatives that lead to optimal performance. It is performance that the user buys from the transportation service. Importance of an Effective Transportation System One needs only to contrast the economies of  developed nation with those of a dev

Has the global economy turned the corner? Data presented in Ti's latest   Global Logistics Monitor suggests it might have. Manufacturing activity appears to be picking up throughout Asia, Germany and the US and even demand for airfreight may finally be improving. Still, it is too early to tell, particularly as it is always difficult to compare year-over-year data for the months of January and February because of the lunar Chinese New Year holiday. However, while China's manufacturing activity stumbled a bit for February, as noted by the China Customs Administration, its exports for the first two months of 2013 grew 24%, while imports grew 5%.  The EU, US and the ASEAN countries were China's top trading partners. Exports to the EU increased nearly 3.2%, while exports to the US and the ASEAN countries grew by 14.8% and 22% respectively. Most notably, exports of high-tech products grew 26.2% year-on-year. Even in the midst of Europe's economic squalor, Germany ap

Last year proved tough for transporters on the world’s busiest trade routes between Asia and Europe. Both the sea and air markets suffered from weak demand and overcapacity as new orders of airplanes and ships continued to come on line. The container shipping market was down around three percent worldwide by volume in 2012 compared to the previous year, says Denis Sanguinetti, sea-freight procurement manager at Bolloré Logistics. Routes between Asia and Western Europe suffered the biggest drop of between seven and eight percent, he adds. Similarly, the volume of goods transported by air fell by around 2.5 percent worldwide, says Georges Van Hove, manager of airfreight procurement at Bolloré Logistics. “The air-freight market will remain weak as long as the global economic recovery is uncertain and capacity stays high,” he warns. In particular, the sea container market looks set to continue its record level of volatility as shipping companies seek to balance supply and demand.

When retailers managed inventory, one of the methods for inventory control was to use some form of a trigger-point method replenishment program. That is, when an item in stock is depleted to the level of the trigger point quantity, a purchase order is placed on a vendor to replenish the item. In such systems, retailers make their own forecast and inventory control rules. Alternately, retailers will replenish on a fixed cycle i.e. once a week basis and order an amount to fill designated shelf space for an item. According to the International Mass Retail Association, over 60 percent of hard goods and almost 40 percent of soft goods are under replenishment programs managed by retailers. Although retailer-managed replenishment programs are expected to continue, there are also expected to be a substantial growth in vendor-managed inventory (VMI) that is continuous replenishment. With electronic data interchange (EDI) and point of sale data, vendors can be as aware of what is on the ret