Download - Basic Concepts in Transportation Part Seven

Basic Concepts in TransportationPart Seven

Marketing Logistics

Other Economics of Transportation


• Derived demand.


• Derived demand.• Landed cost.



– Cost of product plus its transportation costs.



– Cost of product plus its transportation costs.– If a product shipped all the way from China

costs less than a product made in our city, it has a competitive landed cost.

Service Components of Freight Demand.


• Transit time


• Transit time– The longer the transit time, the higher the

inventory levels and inventory carrying costs.



inventory levels and inventory carrying costs.– The longer the transit time, the greater the

chance of stockouts.




chance of stockouts.• Reliability





– Reliability affects modal and carrier demand.





– Reliability affects modal and carrier demand.• Accessibility.






– Motor carrier advantage.


• Transit time– The longer the transit time, the higher the inventory

levels and inventory carrying costs.– The longer the transit time, the greater the chance of

stockouts.• Reliability


– Motor carrier advantage.• Capability.


• Transit time– The longer the transit time, the higher the inventory

levels and inventory carrying costs.– The longer the transit time, the greater the chance of

stockouts.• Reliability


– Motor carrier advantage.• Capability.

– Refrigerated equipment.


• Transit time– The longer the transit time, the higher the inventory levels and

inventory carrying costs.– The longer the transit time, the greater the chance of stockouts.

• Reliability– Reliability affects modal and carrier demand.

• Accessibility.– Motor carrier advantage.

• Capability.– Refrigerated equipment.

• Security.

End of Program

Go to Part Eight.