Lecture notes Course Principles of Transportation: summary Introduction to Transportation PDF

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Download Lecture notes Course Principles of Transportation: summary Introduction to Transportation PDF

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LOGT 3231 L esso n : Introduction to Transportation 1. What is Supply Chain Management? The design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally. 2. What is Logistics? That part of the supply chain process that plans, implements, and controls the efficient, effective flow and storage of goods, services and related information from the point of origin to the point of consumption in order to meet customers’ requirements... 3. List examples of traditional Logistics activities: • • • • • • • • •

Forecasting/scheduling Purchasing Inventory management Materials handling Order processing Warehousing Customer service Information management Transportation

4. What is Transportation? The physical movement of people and goods A bundle of services (speed, movement, cost, equipment moved) 5. What type(s) of utility does Transportation provide? • • • •

Form Utility Possession Utility Place Utility: where the product is needed= at the right place Time Utility: when the product is needed= at the right time

6. List the different modes of transportation in the order they began to be prominently used (earliest to latest). Before 4000 B.C. • Tied to rivers, lakes and oceans

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Limited interaction, struggle for survival

4000 B.C. – 400 A.D. • Domestication of animals, intervention of wheeled carts, development of roads • Increased mobility, speed, and capacity • Development of commercial trade, exploration of different lands, and military activity 400 A.D. – 1400 A.D. • Advances in water transportation • Development of intercontinental trade 1400 A.D. – 1700 A.D. • Invention of four wheel coaches, rail methods • Improved passenger safety and comfort 1700 A.D. – 1900 A.D. • Development of steam engine, improved rail technology 1900 A.D. – Today • Development of automobiles, trucks, paved roads, interstate highways, airplanes, etc. • Ability to travel farther, faster, more safely, and more economically than in all preceding history • Creation of global markets, dissemination of info, expansion of prosperity and leisure time pursuits 7. What percentage of the U.S. GDP (2013) was spent on Logistics? 8.2% 8. How much ($$) was spent on Logistics (2013)? 1.39 Trillion 9. What mode dominated inter-city revenue generation? Truck 10. What mode dominated intercity ton-miles transported? Railroad

11. What are some different product characteristics that impact Transportation decisions? • • • • • • •

Weight Volume Shape Durability Value Customer Demand After Sales Report

12. Compare Transportation costs (as a percentage of product cost) for High density/low cost items and Low Density/High Cost items. High-cost Sectors

Stone, clay and glass 27% Petroleum products 24% Lumber and wood 18% Chemicals 14%

Medium-cost Sectors

Paper and allied products 11% Primary metals industries 9% Textile mill products 8% Fabricated metal products 8% Miscellaneous manufacturing 8%

Low-cost Sectors

Tobacco manufactures 5% Machinery, w/o electrical 5% Instruments 4% Apparel and other textiles 4% Printing and publishing 4%

13. Who are the three primary Transportation Stakeholders? Users Providers Government 14. What is the primary interest/concern for users? • •

Depends on it Cost Sensitive  Service  Taxes

15. What is the primary interest/concern for providers? • •

Sound Infrastructure Profitability

16. What is the primary interest/concern for the government? ??

LOGT 3231 L esso n : Transportation Demand 1. What is derived demand? Comes from the demand of the end item at some other location 2. What is demand elasticity? Sensitivity to price change (% quantity change) / (% price change) • Elastic > 1, (if prices rise, demand will drop) • Inelastic < 1, (if prices rise, demand won’t drop) 2. What is landed cost? • Cost of product at source • Cost to transport the product • Demand will exist if demanded cost doesn’t exceed those of other suppliers • Determines scope of the market 3. Define key transportation service characteristics and their impact on business costs. Impacts: Inventory, sales, network design, customer satisfaction, warehousing, forecasting • Transit Time o Slow transit times impact cost for both the shipper and the receiver  Carrying/holding cost for shipper (on the books)  Higher inventory levels for the receiver (prevents stock-outs) • Reliability

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o Consistency of transit times  Safety stock increases  Increases probability of stock-outs  Change carries for different modes Accessibility o Ability to move freight to a specific origin and destination (often requires multiple modes)  Drives transit times  Drives transportation cost Capability o Ability of carrier to provide special service requirements  Meet unique requirements? • Controlled temperatures • Break-bulk facility • Oversized freight • Time Security o Safety of goods in transit  Pilferage  Damage • Increases inventory cost for buffers • Increases likelihood of stock-outs

4. Define and explain common transportation measures. How much freight is moved? • Tons • Ton-Miles = (# of tons)(# of miles) • Revenue How many people are moved? • Passenger • Passenger-Miles = (# of passengers)(# of miles) • Revenue 5. Identify key facts associated with each of the major modes of transportation. Highway System • 4.0 million total miles of roadways in the U.S. o 2.7 million are paved • 213,585 miles of interstate • 601,396 bridges • Primary road types o Local 73.7% o State 20.3% o Federal 5.9%

Air System • 19,930 airports o 505 primary commercial service airports o 5,502 public use airports • Aircraft in the system o 8,225 carrier aircraft o 231,607 private aircraft Water System • 25,320 miles of navigable U.S. waterways • Primary types o Inland waterways, Great Lakes, Costal Rail System • 94,082 miles of rail lines • 21,178 miles used by Amtrak • 10,282 miles of commuter trains...