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Modes of Transportation in Supply Chain. Trey Lynn Brigham Young University BusM 361 Professor S. Tom Foster. Agenda. Transportation defined Brainstorming Modes of transportation Strengths and weaknesses of each mode Pricing UPS example Exercise Summary. Transportation.

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modes of transportation in supply chain

Modes of Transportation in Supply Chain

Trey Lynn

Brigham Young University

BusM 361

Professor S. Tom Foster

agenda
Agenda
  • Transportation defined
  • Brainstorming
  • Modes of transportation
  • Strengths and weaknesses of each mode
  • Pricing
  • UPS example
  • Exercise
  • Summary
transportation
Transportation
  • means of conveyance or travel (of goods and services) from one place to another
brainstorming
Brainstorming
  • What types of products require transportation in your organization?
  • How far are these products required to travel?
  • How important is the speed of delivery for these products?
modes of transportation
Modes of Transportation
  • Motor
  • Air
  • Rail
  • Water
  • Pipeline
  • Intermodal
motor trucking
Motor (Trucking)
  • 1970’s – economic deregulation of interstate traffic
  • Lower costs
  • Accessibility
  • Small, frequent shipments
trucking
Trucking
  • Disadvantages
    • Speed
    • Capacity
    • Range
slide8
Air
  • Premium transportation
  • Speed delivery
  • Range
slide9
Air
  • Disadvantages
    • Price
    • Non-direct points
    • Add-on charges
    • Necessary?
slide10
Rail
  • Lowest overall cost per unit weight
  • Consistent time schedule
  • Recommended with most commodity types
  • Weather
slide11
Rail
  • Disadvantages
    • Inflexibility
    • Potential damage of goods
    • Ineffective with small shipments
water ships
Water (Ships)
  • Large volumes
  • Long distances
  • Slower than air travel
  • Limited access
pipeline
Transport of homogeneous materials

Lower transportation costs than other modes

Higher initial costs

Unable to transport a variety of materials

Pipeline
intermodal
Intermodal
  • Use of various transportation modes
  • Containers
  • More popular due to globalization
pricing
Pricing
  • Handling characteristics
  • Distance freight is moved
  • Weight of freight
  • Costs inversely related to speed of service
united parcel service
United Parcel Service
  • Small package shipper
  • Business built around transportation
  • Effective intermodal transportation
ups methods
UPS - Methods
  • Trucks
    • Small, frequent shipments
    • Deliver directly to homes and businesses
  • Air
    • Time sensitive shipments
    • Small packages (long distances)
ups methods18
UPS - Methods
  • Rail
    • Transcontinental distances
    • Used primarily in intermodal transport
  • Sea
    • Door to door ocean shipping
    • Weekly departures between major ports
slide19
UPS
  • Provides expertise as a resource to businesses
  • http://www.ups-scs.com/transportation/
exercise
Exercise
  • Take ideas from brainstorming and decide which modes of transportation would be best for your company.
  • List circumstances which would require using alternate modes of transportation and consequences your company would encounter.
summary
Summary
  • Each mode of transportation has its own strengths and weaknesses
  • The effectiveness of each mode depends on several factors including distance, price, and timeliness
  • Services exist to help choose the best modes of transportation
bibliography
Bibliography

Cavinato, Joseph L, Ralph G Kauffman. The Purchasing Handbook. The McGraw-Hill Companies, 2002, New York, NY.

Copacino, William C. and James F. Robeson. The Logistics Handbook. The Free Press, 1994, New York, NY.

Taylor, David. Global Cases in Logistics and Supply Chain Management. International Thomson Business Press, 1997, London, UK.

http://www.ups-scs.com/transportation/