Mitigating Risk in Transportation Costs Research Assignment
Link of e-copy of book :
http://danangtimes(dot)vn/Portals/0/Docs/121293332-032478919XTransportation.pdf
one of the text to reference : Text
Coyle, J., Novack, R.A., Gibson, B.J., & Barbi, E.J. (2011). Transportation: A Supply Chain Perspective (7th ed). Mason, OH: South-Western Cengage Learning. ISBN: 978-0-324-78919-5
Mitigating Risk in Transportation Costs
Appendix 4A provides a detailed discussion of cost concepts in transportation, including accounting, economic and social costs. Review these costs, and in a three- to four-page paper in APA format, be sure to address the following:
• Discuss how accounting, economic, and social costs can be used in transportation to mitigate risks associated with these costs.
• Analyze how the company's focus can impact these costs and impact risks.
• Provide at least one recommendation for each cost area that could mitigate the risks of those costs.
Your paper must be three to four pages in length (not including the title and reference pages) and must be formatted according to APA style as outlined in the approved APA style guide. You must cite at least three scholarly sources in addition to the textbook.
The Paper
• Must be three to four double-spaced pages in length (not including title and references pages) and formatted according to APA style as outlined
• Must include a separate title page with the following:
o Title of paper
o Student's name
o Course name and number
o Instructor's name
o Date submitted
• Must use at least three scholarly sources in addition to the course text.
o The Scholarly, Peer Reviewed, and Other Credible Sources table offers additional guidance on appropriate source types. If you have questions about whether a specific source is appropriate for this assignment, please contact your instructor. Your instructor has the final say about the appropriateness of a specific source for a particular assignment.
• Must document all sources in APA style as outlined in the
• Must include a separate references page that is formatted according to APA style as outlined in the.
Mitigating Risk In Transportation Costs
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Mitigating Risk in Transportation Costs
All businesses strive to operate using lean and profitable options; however, the risks caused by challenges from both external and internal forces have increased .Unexpected risks can strike causing major disruption that might affect the business operation that can result in closing the business (Chopra & Sodhi, 2014). Based on these factors, it is essential that businesses develop a realistic risk reduction plan. Reducing cost and proper cost management in transportation are an important consideration for logistic companies, that is why they take into consideration all types of risk related to transportation to mitigate all the risks (Coyle et al., 2010).
Accounting costs need to be considered when planning the cost of transportation factors like the cost of fuel; salaries to be paid for drivers, terminal expenses and cost of advertising are some of the accounting costs (Talluri et al., 2013). The main challenge is how to allocate funds appropriately. Some of these costs can be incurred during loading and shipment processes (Coyle et al., 2010). A transportation company needs to invest in up to date transportation equipment and personnel. When personnel are well compensated there will be fewer accidents (Talluri et al., 2013).
Economic risk involves business decisions made to undertake certain activities. In this case, the cost is related to the value of the resources and the most beneficial alternative. The economic costs are costs to be incurred in the future (Talluri et al., 2013). For instance, the economic costs within the transportation industry are costs of oil for the future operation. The risk involved in this case that are related to economic costs can be mitigated by making proper forecasting on the future of the market trends versus the operation. Forecasting can be received by drawing termly budgets (Talluri et al, 2013).
Within the transportation industry, the overall expenses of transport operations are expenses attached to the society of policy changes (Talluri et al, 2013). Social costs are more of losses incurred by the public caused by the damages caused as a result of the accidents, air pollution or traffic congestion. The risks involved related to social costs are accidents that occur during freight. To reduce such risk companies need to put in place specify policies that would minimize the rate of accidents (Talluri et al, 2013).
How the company's focus can impact these costs and impact risks
Companies have the responsibility to reduce the risk and ensure that appropriate actions are taken to avoid losses (Talluri et al., 2013). The main focus is on b...