Transportations and distribution industry plays an important role in bridging the gap between the producer and the consumer. Forms of transportation available include air, water, rail and land. The transport industry is one of the driving forces for economic development. The cost of transportation is a major cost that all firms in this industry would like to reduce (Markowitz, 2011). The economic benefits of reducing transportation cost are notable and are a direct way of improving profits for any firm. According to Hines (2004) the question of how to reduce these cost remain one of the constantly explored by many transportation firms. Each firm desires to develop an effective strategy to reduce the costs.
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Distributions is important since it ensures production and needs are in balanced thus it is an important part of the economy. Moving products from producers to the consumers regionally, nationally and internationally can account for more than half of the total cost of the products. Therefore, the management of transportation and distribution should focus on the economic aspects (Rodrigue, et al. 2010). Efficiency and effectiveness of the transport system is vital in reducing the costs. Subsequently, management of the operations includes analysis of the costs of everything involved. Operations administration is carried out depending on the nature of the products or services that the organization is dealing in.
Discussion and Analysis
On 31 November 1981, I and five other partners came together and initiated a privately own a transport company Swift world transport Ltd. The company provides innovative, cost effective and reliable transportation of food products. Swift world transport Ltd specializes in food products shipment and carriage between various states and towns. After realizing that an opportunity exists in coordinating of food products, we launched a strategy to fill the void. Our trucks and carriers deliver food products to one destination and return with another load to another destination. The company desires not only to meet customerââ‚¬â„¢s expectations but also to exceed it every time. Currently we have over 500 trucks operating around five states. Since transport costs account for a considerable portion of the selling price of food products, we put emphasis on making smart economic decision (Rodrigue, et al. 2010).
Swift world transport Ltd. Deals with a wide range of food products. The products range from cereals, soft drinks, biscuits and cookies, baked goods, ready meals and frozen foods. Other products that we transport in smaller quantities include dairy products, honey and seafood. Swift world transport Ltd. Is ISO-certified and will be celebrating 30 years in existence late this year. Though the company began from humble beginnings, it has grown to be one of the market leaders in transportation of food products. It has more than 300 employees and is strategically located with its head office in New York. Swift world transport Ltd upholds integrity and abides by the rules and regulations in the transport industry (Markowitz, 2011).
At Swift world transport Ltd we value the customers hence we use the latest technology and equipments in handling the products to meet customerââ‚¬â„¢s needs of quality. We have refrigeration services to keep perishable products from being spoilt. The ministry of health officials has approved our warehouses as safe for storage of edible products. Our trucks are monitored via satellite hence we have an error free billing system (Rodrigue, et al. 2010). Swift world transport Ltd. Has three main departments. The first department deals with the transport infrastructure. These include the trucks and the sea vessels. The second department includes the food handling facilities such as refrigerators and warehouses. Finally, the last department ensures that there is always adequate supply of the products depending on the demand.
Physical distribution involves the transportation of the food products from the various sources to the customers. The manager directing the physical distribution has the responsibility of assessing and controlling the cost of transport. He is also charged with the responsibility of ensuring the most efficient way of storing them. This in some cases may require warehouses hence inventory control. A manager should thus ensure that the right goods arrive at the proper destination in the right condition and to the correct client. As explained by Halldorsson et al. (2003) the goods should be in the right quantity.
The transportation strategy adopted by the Swift world transport Ltd swiftly responds to all aspects of our operations with priority on customers and suppliers. The strategy acknowledges customer requirements as an important aspect of all its activities. The supply chain is a involves movement of products from suppliers to the customer. The transportation activities should focus on meeting customer needs. Transportation and shipment must therefore progress according to the timings (Rodrigue, et al. 2010). Customers require that products be delivered at their premises on a particular day and time. This needs to be accomplished in order to provide customer satisfaction. Being able to meet these deadlines has given Swift world transport Ltd a competitive advantage over other firms. The size of our firm also causes our customers to trust in our ability to be reliable. They believe that small firms are not reliable. Comparing performance is important for the firm to know how well our strategies are working (Larson, & Halldorsson, 2004). In order to remain economically sound, we measure our expenses every now and then in order to have tight control over them. Estimation of general expenses and freight costs assists the company in budgeting.
A supply chain is a system that brings organizations, people, information and other resources in bridging the gap by ensuring that goods and services move from supplier to consumers. Supply chains ensure that goods are delivered to the end user. The management of a supply chain involves planning and management of activities ranging from sourcing, procurement and the logistics. At Swift world transport Ltd. coordination and collaboration with the suppliers and customers and other third party service providers is our priority. The company has created a supply chain that integrates all activities with the main responsibility of linking our suppliers and the customers (Rodrigue, et al. 2010). A model of a supply chain begins from receiving the products from producers and suppliers and ends with the delivering to the consumer. Swift world transport Ltd adopted the model whose framework is developed on business processes that are not only cross firm but also cross functional. A team manages the cross-functional processes with representatives from purchasing, finance, logistics and research and development (Halldorsson, et al. 2003). Since each process interacts with customers and suppliers at some point, customer relations and supplierââ‚¬â„¢s relations form an important part in the supply chain. The company must make the right decision when moving products from one point to the other. Distributing products faster and cheaply leads to higher profits and more satisfied customers. In order to do this, Swift world transport Ltd stays informed on the current trend within the industry. For illustration, most companies are moving in the southern states because where doing business is more cost effective. The company has been analyzing facts and trying to make a decision whether to move south.
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In 1990, Swift world transport Ltd. adopted the supply chain management (SCM). This was adopted after realization that most food products require integration of many business processes, from the original supplier to the customer (Halldorsson, et al. 2003). The suppliers provide the company with products, services and important information that boost our business. SCM enables us to exchange information with other stakeholders regarding market fluctuation. After realizing the importance of information, we adapted the SCM to enable us access relevant information. This is made possible since all the companies in the supply chain help optimize the entire chain. The company can therefore plan its distribution activities better hence leading to customer satisfaction. In addition, incorporation of SCM leads to reduction of competition (Hines, 2004). This is because the competition is not from one company to the other but on supply chain and supply chain.
The aim of supply chain management is to uphold customer satisfaction by using the available resources efficiently. It seeks to keep the demand and supply at equilibrium. Since many food products are perishable, it pays to liaise with producers to minimize bottlenecks. The products are obtained from farmers and suppliers at the lowest cost (Hines, 2004). Transporting is followed by distribution and finally delivering the products to customer markets.
One of the main challenges that Swift world transport Ltd faces is the presence of congestion in our road system. The causes of congestion come from higher requirement for mobility, which many times go beyond the facilities that support it. Other causes can be random events like accidents, which normally disrupts the flow of vehicles. Congestion is not only present on the roads, concentration of traffic is observed even on maritime transport. This is so common especially in terms of weight. Traffic concentration is causing many problems at the ports. In the past few decades, international trade has been experiencing higher growth than the global economy resulting in congestion at the ports. Congestion has the effect of delaying products on the road hence causing late Deliveries. Late deliveries in turn lead to loss if business opportunities and dissatisfied customers.
As a major stakeholder in the transport industry, we have joint hands with other like-minded firms to put pressure on government to build more road network. A transport policy that will provide solutions to congestion problems should be developed. This requires long term planning to build of more roads and ports in order to ease the congestion. States with port facility should apply for grants from the federal government in order to improve their inadequate facilities. These are the solutions to preventing the constant congestion.
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