The time and service aspects of transportation are vital. Measuring/Metrics. Transportation must responsive and needs a focus with a carrier--a relationship. Rather it is a way to respond to the dynamics of the business, its customers, suppliers' and operation. Measuring means comparing performance versus agreed standards. The strategy, regardless of whether you are involved with domestic or international, should recognize—. A test of measuring costs is how well the transport spend is being managed. New businesses. The supply chain involves continuous and efficient movement of product from vendor to manufacturer to customer. Transportation refers to the movement of product fromone location to another as it makes its way from thebeginning of supply chain to the customer. Transportation ppt of suppy chain management 1. It is not a question of whether or not it happens. Each of these can dramatically impact the strategy. This is an important and difficult issue. New products. The strategy should be able to change. Shipments must move timely. How will the inventory and service impacts be measured as compared to the freight charges? Below are seven uses of transportation in supply chain management: 1. New suppliers. And, with supply chain management, this means realizing primary customers and delivery locations. Firms should understand what is happening within each mode and align the strategy with carriers who will still be viable in the future—often five years since strategic plans may extend that far. The strategy cannot be one-dimensional. Carrier relationships. Each shipment does not have the same priority. It should be segmented to reflect urgencies. It is not playing one carrier off against another. The times they are a changing--and so will the strategy. Rather it is a way to respond to the dynamics of the business, its customers, suppliers' and operation. The supply chain relies on the efficient management of assets and logistics to get raw materials, parts and finished products from one place to another. Freight and fuel costs take up most of the logistics budget. It is not playing one carrier off against another. Customers demand their shipments be delivered as they require--on the date needed, by the carrier preferred, in the proper shipping packaging method and complete, both shipped complete and delivered complete and in good order. Conclusion. What is the actual delivery to customer performance, on a macro basis, carrier and customer by customer basis? This is seen most easily in the transportation element. That can mean mode changes and/or alternative carriers. A transportation strategy, to be effective in supply chain management, is fitting the movement of goods to the corporate supply chain. What roles do transit time play in your supply chain? Customer requirements. Carrier mergers and alliances and closings. Transportation is an important supply chain driverbecause products are rarely produced and consumed inthe same location. How will products move, by air versus surface? Identify your Challenges: Take the Supply Management Self Assessment, Logistics & Supply Chain Management Consulting. Segment. When you’re sending goods around the world, it’s vital to use your transportation resources in the right way. Transportation is a key logistics function and is critical to supply chain performance. Transport performance metrics can provide a way to view the value of the spend. Transportation is used to reduce costs. Usually supply chain management simply becomes a balancing act of time versus cost. The transportation in a supply chain can be used to control costs in a business operation. Volume creates carrier/forwarder attention. Flexibility/Adaptability. It also impacts with the other two issues of movement of information and integration within and among suppliers, customers and carriers. A great strategy with a carrier who is taken over or goes out of business is suddenly not a good strategy. The only question is how quickly it occurs. A transportation strategy, to be effective in supply chain management, is fitting the movement of goods to the corporate supply chain. New customers. What modes will be used? The Delicate Balance of Transportation Supply Chain Management. A macro measure can hide a problem even if the overall measure is good. This cannot be done for two reasons. But there is another side to this attention as to freight cannot be divided among many carriers. Change is happening. It is important to know how well the strategy and carriers are performing. To meet the vigorous requirements of the supply chain, the strategy should be dynamic. It involves the movement of product, service/transit time, and cost which are three of five traditional key issues of effective supply chains. ©2020, LTD Management, All Rights Reserved. | Website services provided by EZMarketing. The carrier attention with volume creates a competitive interest in your business. Transportation is a key logistics function of supply chains which runs from suppliers through to customers or stores. Mode selection. First, as random, fracturing of the freight impacts negotiating or leverage position. Infrequent shipping dictates another approach. Even if there is no strategy, the number of carriers trying to get business will make firms develop one. Second, too many carriers hinder the ability to develop carrier relationships needed to meet supply chain requirements. Products, suppliers, customers, time of the year, and other factors can affect the importance and urgency of transport movements. It must be responsive, both as to service and cost demands. There are many ways to ship goods from one place to another, but with foresight, the cost of shipping can be balanced through different practices and compared against relative … One is measuring. Therefore, the transportation program must reflect and meet customer needs. New corporate emphasis. Developing supply chain responsive programs be demands effort by both the carriers and shipper. Being able to have a transportation program with can do this provides customer satisfaction and can give your company a competitive advantage. This takes two approaches.

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