When you think about global trade and procurement, logistics is a primary element that needs to be addressed. Freight transport or shipping options refer to the physical transportation of goods from one place to another. The term ‘shipping’ was originally used to indicate transportation by sea. With advent of modern technology, dense connectivity and improvement in logistics, several shipping options are available to us today. Global procurement is an essential aspect for manufacturers. Hence, it is important to make a wise choice about shipping. Supply chain management has to evaluate the best possible shipping options for their products.
As we all know- air, land and sea are the primary modes for freight transport. Though these options come across as convenient modes, one can make the right decision after thorough analysis. Study of cost, local policies and nature of products involved can determine the correct shipping option. As global trade is done across countries, you cannot ignore local governmental policies. Supply chain management can work over these three major elements. Thorough analysis will ensure cost-effective approach with high level of customer satisfaction.
Shipping through sea has been the primary choice in several cases due to lower costs. Yet, it has its own set of challenges. You can also consider inter-modal transport as another shipping option. It involves combination of two or more modes.
While deciding an ideal shipping option, cost certainly holds higher significance. Sea transportation is relatively cheaper as compared to air and land. Several freight transportation services over sea ensure excellent services in a timely fashion. Before picking a shipping option, it is necessary to evaluate the budget and consider all types of cost involved. It is important to determine the ‘freight rate’ for transportation as that can impact your overall budget.
Global trade involves transportation across geological boundaries. One should consider policies of local government.Supply chain management should focus on additional costs in terms of taxes, insurance and local policies of the country.
Depending on the nature of product, supply chain management can decide the convenient logistics. Packaging of products plays an important role in this factor. You must consider the nature of packaging material, size of boxes, volume, density, weight and arrangement of products within the carrier. Cost of packaging material can influence the mode. Unit cost of denser material is cheaper than the less denser ones. Hence packaging of paper will be cheaper as compared to larger size boxes. Before you can finalize the mode, you must pay close attention to the packaging of the products. Packaging size affects air transportation to a great extent. But, land and sea modes are relatively flexible on those grounds.
Time for packaging, transportation and unloading at the destination can influence the shipping options. Air transport is the fastest mode, while sea route is slowest. Transportation by land involves rails and trucks, but demand greater margin of days.
Thus supply chain management should handle the domain of logistics with proper consideration and thorough analysis. The final choice will reflect over quality, budget and customer satisfaction to a great extent.