Final Paper: National Transportation Management

Transportation Management in Supply Chain Paper Student Name Institution Course # and Name Professor’s Name Submission Date Introduction Transportation management, a critical component of logistics management, refers to the safe, reliable, sustainable, and efficient movement of goods and persons over time from one place to another. It is the process through which materials, products, and services gain value when they are translocated from where they are less needed to where they are in high demand. The principles of operation, product movement, and storage are the significant functions of transportation management. When necessary, multimodal transportation, a system that combines different modes of transportation, is utilized. This paper will delve into transportation management, focusing on supply chains, principles and functionality, the benefits of multimodal transportation, and the factors influencing the choice of transportation mode. Supply Chains in Businesses The supply chain is the movement of products and services from the creation area to their consumption area using an efficient and cost-effective approach. This means that the right product is delivered to the right consumers at the right time, and a reasonable price is tagged. Successful businesses have mastered the art of effective supply chain management and reaped the benefits coupled with their competitive advantage over similar companies. Transportation management is one of the functions of supply chains, with efficient supply chain managers ensuring that the average transport costs do not significantly impact the commodity's recommended retail price. A well-developed transportation system brings maximum advantages to logistics (Department of Transportation, 2020). This includes reduced operation costs, better logistics efficiency, and quality services. Considering the competitive advantage that effective transport management brings to business logistics, entrepreneurs and government enterprises should take this area seriously. Transportation Principles The principles of economy of scale and economy of distance are fundamental concepts in transportation economics that significantly influence transportation operations' cost structure and efficiency. The economy of scale principle relates the size of a shipment to the cost per unit of weight. In supply chains that handle large amounts of specific products or small quantities of many products simultaneously, increasing the shipment size decreases the cost per unit weight. The fixed cost component of transportation allows businesses to maintain constant transportation prices regardless of the amount shipped. For example, a truck will incur similar administrative charges, driver wages, and vehicle maintenance costs, irrespective of whether it is fully loaded or partially loaded with products. Transportation management ensures that any route taken by a truck is utilized to the maximum, based on the principle that larger shipments allow for greater utilization of transportation resources and infrastructure, resulting in economies in handling, loading, and transportation costs. The second principle of transportation management is the economy of distance based on relative costs per unit distance (Ciusk et al., 2023). Transporting goods long distances is ultimately more expensive than transporting similar short distances. However, operations costs are involved in both cases, ultimately affecting the total transportation costs. For example, a truck transporting goods over a long distance is more capable of achieving higher fuel efficiency using optimal cruising speeds. Lv et al. (2020) state that longer distances also provide opportunities for consolidating shipments, maximizing vehicle capacity, and reducing the cost per unit transported. Strategies such as consolidating shipments, increasing shipment sizes, and optimizing transportation routes can help organizations achieve economies of scale and distance. Transportation Functionality Transportation temporarily stores a product while it moves from one point to another, depending on the production or marketing objectives of the company. Product movement impacts transportation functionality because it allows the translocation of commodities, which ultimately minimizes financial, temporal, and environmental resource usage. Efficient product movement also reduces lead times, improves order fulfillment rates, and maintains competitive advantages in the marketplace. On the other hand, product storage involves temporarily storing goods during transit or between transportation stages. This is critical in transportation management, especially when supply chains need to consolidate, sort, or transfer goods between different transportation modes. Companies must strategically position temporary storage facilities along transportation routes to ensure accessibility and minimize delays in the transportation process (Litman, 2021). Moreover, temporary storage facilities should comply with safety and security standards that protect goods from theft, damage, and unauthorized access. When valuable goods go missing in a supply chain company, there will be negative impacts like compensation costs and reputation damage. Proper security measures, such as surveillance systems, access controls, and inventory tracking protocols, can be implemented to safeguard assets. Multimodal Transportation Transportation management ensures that goods seamlessly move from origin to destination within the scheduled period. In some cases, the product may not necessarily move from one point to another using a single mode of transport. Crude oil extracted from the earth’s internal rock must be transported via land to the ports, where they will be transferred to sea vessels destined for foreign countries. On reaching the destined countries, road transport will be needed to transport the crude oil to refineries located in the inland or if the government is landlocked. The value of a product can be increased by delivering it to the area where consumers stay. Products may require more than one mode of transport to reach processing points or consumers. Multimodal transportation aims to optimize the movement of goods, people, and information from origin to destination (Böcker et al., 2020). Intelligent transport systems achieve greater coordination, visibility, and responsivenes...