| What types of transportation modes do we have? | Road, Air, Sea & Rail |
| Describe sea transport | Delivery time – Slowest
Size of shipment – Largest
Transport cost – Lowest cost per ton-kilometer
Capital tied up – Highest
Delivery accuracy – Lowest
Flexibility in routing and time – High, but only between harbors (Hamnar) |
| Describe Railway transport | Delivery time – Fast
Size of shipment – Large
Transport cost – Low variable costs and high fixed costs
Variable costs: Loading, unloading and switching of trains and wagons
Fixed costs: Maintenance (Underhåll) and depreciation (värdeminsking) of railway, terminals, and administrative costs
Capital tied up – High (esp. if goods are highly valued)
Delivery accuracy – Low
Flexibility in routing and time – Low, terminals and railways sets the boundaries |
| Describe Road transport | Delivery time – Fast, especially ”from A to B”
Size of shipment – Small
Transport cost – Low fixed costs and high variable costs
(Rörliga kostander) Variable costs: Fuel
Fixed costs: Terminal costs
Capital tied up – Low
Delivery accuracy – High
Flexibility in routing and time – High, only roads and driver regulations
sets the boundaries |
| Describe Air transport | Delivery time – Fast, fastest
Size of shipment – Small
Transport cost – Highest
Capital tied up – Low
Delivery accuracy – High
Flexibility in routing and time– Low and limited to airports and routes |
| What is Multimodal transport | • Transportation that combines several types of transports
• Uses the type of transport most efficient for each part of the total transported distance
• Efficient transitions between types of transports = efficient work at terminal
• Unit carriers (pallets or container)
• In a distribution center, goods can be unloaded and then loaded, with or without registration in inventory
• Usually made in three steps:
1. Unload inbound goods
2. Inspect goods and sort
3. Reload goods and send off
• Potential benefits of time saving, money saving, and customer satisfaction
• Can be useful for perishable products but can demand investment in terminal |
| What is Cross-docking? | Cross-docking is a logistics process that involves the efficient transfer of goods from an inbound shipment to an outbound shipment without the need for long-term storage. There are three main types of cross-docking: |
| Describe the main types of cross-docking | • Trans-shipment: In this type, the received order is already packaged and ready for delivery to the customer. It is simply transferred from the inbound shipment to the outbound shipment without any additional processing or sorting.
• Flow-through: With flow-through cross-docking, some level of sorting or break bulk is required when the order is received. The goods are quickly sorted and reorganized before being loaded onto the outbound shipment.
• Merge-in-transit: In this case, the existing inventory stored at the distribution center (DC) is combined with the incoming order. This allows for customization or modification of the order before it is shipped to the customer. |
| What is Postponement, or delayed differentiation | Is a supply chain strategy where a product is maintained in a generic (Allmän) state for as long as possible. The process of transforming the generic product into a specific end-product is delayed until closer to the consumer. This approach enables the storage of safety stock for a single generic product instead of multiple particular end-products. Postponement reduces the need for excess inventory and minimizes the risk of end-product obsolescence, mainly when demand for specific variations is uncertain. Since the generic product has a lower value compared to the particular end product, less capital is tied up in each stocked unit. |
| What is Consolidation (sammanslå)? | • To fill up a shipment with multiple orders to the same destination or customer
• The fill rate is increased by the coordination of several smaller shipments
• Delivery directly to the stock
• Fixed delivery points in time
• Distribution by Hub and Spoke
– Hub = terminal (loading/unloading, sorting, storing), warehouses, distribution centres
– Spoke = route
– Coordination between hubs: larger shipments are separated and transported further to the customer
– Flows of goods merge from the spokes to be separated or consolidated |
| What is Incoterms? | • When global companies enter contracts to buy and sell goods, they are free to negotiate (förhandla) specific terms:
– These terms include the price, quantity, and characteristics of the goods.
– Every international contract also contains what is referred to as an
Incoterm, or international commercial term.
• A set of international rules for the interpretation of the most used
trade terms.
• Applying Incoterms to sale and purchase contracts makes global trade easier and helps partners in different countries understand one another.
• Lack of knowledge can lead to misunderstandings and disputes between customer and supplier. |
| what are the different transport costs? | Direct transport costs
– Movement of goods
– Loading
– Unloading
– Transshipment |
| What other transport costs is there? | – Packaging
– Temporary storage
– Damage to goods
– Insurance
– Cost for capital
– Fines for waiting time
– Customs / Duty
– Forwarding agent / TPL
– Administration and planning |
| What other factors affect transport pricing? | • Time and distance costs
• Initial, threshold and marginal costs
• Assets and transports costs
• Terminal and variable costs |
| Additional factors affecting transport pricing? | • The volume of the goods
• Density of the goods
• Physical form of goods
• Heat or refrigeration
• Risk
• Supply and demand |
