1-1

Logistics ManagementLSM 730

Dr. Khurrum S. Mughal

Lecture 16

6-2

Transport Fundamentals in Planning Triangle

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Transport Strategy• Transport fundamentals• Transport decisions

Customer service goals

• The product• Logistics service• Ord. proc. & info. sys.

Inventory Strategy• Forecasting• Inventory decisions• Purchasing and supply

scheduling decisions• Storage fundamentals• Storage decisions

Location Strategy• Location decisions• The network planning process

PL

AN

NIN

G

OR

GA

NIZ

ING

CO

NT

RO

LL

ING

Transport Strategy• Transport fundamentals• Transport decisions

Customer service goals

• The product• Logistics service• Ord. proc. & info. sys.

Inventory Strategy• Forecasting• Inventory decisions• Purchasing and supply

scheduling decisions• Storage fundamentals• Storage decisions

Location Strategy• Location decisions• The network planning process

CR (2004) Prentice Hall, Inc.

Importance of Effective Transportation System

• Comparison of developing Vs developed countries

• Increased Competition and access– Perishable Items

• Economies of Scale– Auto Parts

• Reduced Prices– Oil and Middle East

13-3CR (2004) Prentice Hall, Inc.

6-4

Transport System Defined

CR (2004) Prentice Hall, Inc.

· Performance - Average transit time - Transit time variability - Loss and damage - Other factors including availability, capability,

frequency of movement, and various less tangible services

· Cost - Line haul - Terminal/local - Accessorial or special charges

6-5

Transport Choices

CR (2004) Prentice Hall, Inc.

· Primary intercity carriers - Air - Truck - Rail - Water - Pipe

· Coordinated services - Piggyback - Birdyback - Fishyback

· Small shipment carriers - UPS - Federal Express - Postal services - Bus Package Express

· Agents

- Freight forwarders - Shipper associations

· Others

- Autos - Bicycles - Taxis - Human - Electronic