Description
m com projcet
1
TRANSPORTATION INFRASTRUCTURE
In India is the last one decade or so all the business drivers have taken transportation as a major
activity. Earlier it was taken as back end activity.
Today any firm can consider following for movement of its product
1. Put transportation
2. Contractual agreement with many transportation services providers
Services option
o Changes in billing
o Information availability
o Product liability
o Pick up / delivery practices
Carriers / Transporters have flexibilities to negotiate responsibility for all transportation related activity.
Transportation Functionality
Two function: - 1) Product Movement & 2) Product Storage
1) Product Movement :- Product in any form i.e. Material, Component, Assemblies, work in
process or finished goods, transportation is necessary to move it to next stage of marketing
process or physically closer to ultimate customer.
A Primary transportation is product movement up & down value chain. This in transit goods is
very critical for JIT, & Quick response practices reduces manufacturing & distribution centre
inventories,
Financials of transportation
Transportation is a cost, It does not add to profit line. So the best practise in transportation
management may be saviour of the bottom line cost.
Transportation Cost is
? R & M Cost
? Fuel Cost
? Driver Cost
? Overhead Cost
? Alignment Cost
? Cost of Product _____
Major objectives of Transportation
Move Product Original Location Prescribed Location with minimal Temporal? In Transit
Financial
Environment
Apart from this loss & damage expenses of product during transportation should be minimized.
2) Product Storage: - There may be temp storage facility. At times in transit product storage
on which may be cheaper than unloading / Loading from ware housing to vehicle for further
movement. In essence in many cases the transportation vehicle may be used as a storage
facility it unloading , placing in warehousing , reloading cost is high
A second method to achieve the second storage facility is to direct product from one location to
other. Though product storage in transportation vehicle can be costly, it may be justified from total
cost or performance perspective when loading or unloading cost, capacity constraint or ability to
expand lead times are consider
Cost
2
Transportation Principles
A) Economy of Scale & B) Economy of Distance
A) Economy of Scale
1) Cost per unit of weight when size increase & vice verse. Full Track Load & cost per unit of
scale would be less wrt to not full truck load.
2) Larger capacity goods mover system has very low cost per unit .e.g. Indian Railways, Cargo
Ships, Air Cargo and so on. (Air Cargo for lighter & Costly items or urgent delivery item e.g.
critical spare parts, defence goods during hostilities etc). Here fixed expenses (salary, order
processing, Placing vehicle / mode for loading or unloading).this cost is fixed e.g. Business
house may move 1 bag of sugar or 100 bags, this cost will be same.
B) Economy of Distance: - Transportation cost decrease with increasing distance. It is known as
TAPERING Principle
These two principles are important when the objective of any transportation decision is to maximum the
size of the load & distance that it is shipped while still meeting customer services expectation.
Principles in Transportation Decision: - Transportation activity is different compared
to normal Buyers & sellers scenario. A Buyer negotiates the commercials of any product with Seller.
Both come to an understanding & deal is done. Government taxes, regulates etc are already
incorporated in the basic cost. It is mostly the many in on the basic cost which is negotiated.
Transportation transactions are influences by 5 parties.
1. Transporter (Originating Party)
2. The Consignee (Destination Party)
3. The Carrier (Operators Truck, Rail, Ship etc)
4. The Government
5. Public.
(A) Shipper & Consignee interested in
? Specified pick up 7 delivery time
? Predictable transit time
? Zero loss & damage
? Accurate & timely exchange of information & invoicing.
Goods Flows
Information Flow
Shipper, Consignee & Government Relation
(B) Carrier (Transporter)
? Transporter wants
? Maximise Revenue for transaction
? Minimise operation cost
Public
Government
Shipper Carriers Consignee
3
World try to minimise the operation cost of labour, fuel, R & M cost by asking for & Flexibility in pick up
& delivery time to allow individual loads to be consolidated into economic move.
(C) Government :- It wants
? Stable & efficient transportation environment to sustain economic growth.
? Efficient transportation to ensure that goods reach every part of the country so that shortages
do not occur & price remain under check. E.g. PL 480 wheat grain movement during draught
condition in 1967 in India.
? Carrier to offer competitive services vie a vie profitability.
Government involvement in this sector is in the force of
? Regulation ---- Market which they can services
? Promotion ----- By setting R & D facilities
? Ownership ---- e.g. Railway good carries Road transportation by J & K Government.
These controls allow Government to have a major influence on the Economic success of regions,
industries or firm.
(D) The Public :- Public is Concerned with
? Accessibility
? Cost of Transportation
? Effectiveness
Micro interest is between shippers, Consignee & carriers.
Macro interest is between Governments & Public.
Transportation Infrastructure: - It Consist of
? Rights of way
? Vehicles
? Carriers organisations that offer transportation services on a for hire or internal basis.
Their existing infrastructure available drives.
Modal Characteristics: - Basic transportation modes are:-
? Rail
? Highway/ Road
? Water
? Pipeline
? Air
Importance of these modes is measured in terms of
? System mileage
? Traffic Volume
? Revenue
? Nature of traffic composition
Rail Network: - Railways handle largest number of tonnage with the increase in rail network in India is
the last 100 yrs or so, it has serviced transportation including to maximum by and large all cities &
________ level points are connected. Railways handle following type of loads
? Bulk Loads
? Small Loads
? Piecemeal consignment
? Special Loads
? Perishable loads
4
? Heavy Load / Less cum Volume
? Lighter Load / more Cum Volume
Railways handle significant intercity tonnage & revenue due to its capability to transport efficiently
larger tonnage. Rail road operation incur high fixed costs due to
? Expensive equipments
? Right of way (own tracks)
? Switching yards & Terminals
Railroad experience relatively low variable operation cost. E.g. Steam Engine Diesel Engine
Electricity Engine .This changes decreased the railroad variable cost per ton per mile. Labour
management has further reduced the cost. Railways focus more for haulage of specific products e.g.
raw materials e.g. minerals, petroleum products, food grain, military hardware etc .In early 1980 IR got
into car load & container services. Car load is full wagon load to one party. Railway is more responsive
to specific customer needs.
Specialized services Railroad
? Unit trains
? Articulated Trains
? Double Deck Container
? Refrigerated Cars
? Liquid Transportation
? Gas Transportation cars & so on.
Motor Carriers: - Highway transportation has increased many told in the last decade in India reason for
this was
? Construction of Golden Quadrangle Delhi – Mumbai – Chennai – Calcutta
? Connectivity between District HQ
? Connectivity from District HQ to __________
? Connectivity from __________ to village
Investment in motor roads is low wrt Rail Drawback of motor carriers
? License fee, user fee, toll cost & these are directly related to over the road units. Worli Sea
Link?
? Variable cost in high, Reason, each unit is independently power driven, driver is _______ for
each unit.
? Labour requirement is high.
Motor carriers are low overhead fixed & __________ , R & M high variable cost operation.
Motor carriers are best suited to handle small shipments moving short distance. Characteristics of
motor carriers favour manufacturing & distributive trades, short distance & high value product.
Water Transportation: Oldest mode steamboats came into use in 1800.Diesel powered in 1920 two
types of water transportation.
? Deep water – Sea
? Navigable inland transportation – very less in India.
Advantage of Water transportation
? Capacity to move extremely large consignment
? Relatively safe.
Disadvantage of Water transportation
? Speed & Limited range of operation.
5
? Fixed cost is between Rail & Motor carriers.
For Water carrier Right of way is generally developed by Government. Some put operation also have
their infrastructure e.g. Reliance -------- for petroleum crude, Essar ----------- for steel, Cement etc.
Water transportation employee’s two types of vessels.
1) Deep Water vessels for Oceans.
2) Diesel towards barges for river & cannels.
Examples of Inland freight is missing & basic bulk commodities.
Inland water transportation acts as a warehouse in transit
Pipelines: - It is continuous movement of liquid, gas commodity operate 24 Hrs X 7 days. There is no
empty container or wagon or truck to be returned.
It has highest fixed cost / low volume cost, high fixed cost due to
(1) Right of way
(2) Construction & need of control station
(3) Pumping capacity.
However variable operating cost is very low. Goods shipped are gas, liquid, mineral slurry e.g. coal, iron
ore, etc.
Air Transportation: - it is least utilized mode
Advantage of Air transportation – Speed
However it is more of potential opportunities try than a reality.
Fixed Cost of Air transportation is low compared to Rail, Water & Pipeline .It ranks second only to
highway transportation mode. Fixed cost of Air freight is only cost of air craft & specialized handling
system equipment & cargo container.
Variable Cost is very high – fuel, maintenance, labour etc.
By & large Air transportation is used is used for emergency shipment.
Modal Classification: - It is done terms of historical development of model & intercity ton / mileage &
Fright Revenue .It is analyzed wrt to fixed & variable cost. Modal classification is arrived at by
comparing.
? Market Share
? Cost
? Traffic Composition
It also considers
? Fixed / Variable cost of each mode.
It also consider operating characterisation
? Speed
? Availability
? Dependability
? Capability
? Frequency
Speed: - Refers to elapsed movement time Air is fastest, water is slowest.
Availability:-Ability of mode to services any given pair of location Road transportation is the best in
this.
Dependability: - Variance from expected or Published delivery schedule. Pipeline transportation is
most dependable.
Capability: - It is the ability to handle any transport need i.e. load size
Frequency:- It is quantity of schedule movement. Pipeline is the best.
6
Cost Structure for each mode:-
1) Rail------ High Fixed Cost / Low Variable Cost
2) Highway ----- Low Fixed cost (highways are in place provided by public support, medium
variable cost (fuel, maintenance)
3) Water------- Medium fixed cost (ships/equipment), Low variable cost (capability to transportation
___________)
4) Pipeline ----- Highest fixed cost (Right of way, Construction, Requirement of control system,
pumping capacity) lowest variable cost (No Labour cost of any significance)
5) Air ------ Low fixed cost (Air craft & handling & cargo system). High variable cost (fuel,. Labour,
maintenance cost etc.)
Transportation formats (Contd) :-
1) Contract Carriers -------- Transportation services for select customer’s basis for contract is an
agreement between a carrier & shipper for a specified transportation services at a pre agreed cost,
contract may be for a single load or a number of loads over a time. Business agreement becomes
the basis for contract carrier to get a permit to transport the specified items. Petrol, LPG, GAS,
_________.Carrier may be owner operator e.g. Bottle carriers of soft drinking CNG, LPG etc.
2) Private Carriers: - It consists of a firm providing its own transportation. Private carriers are not fort
hire, but they must comply with regulation concerning hazardous goods movement, employee
safety, vehicle safety & any other social regulations put by law Government (R.T.O). The primary
distribution between private & for hire carriers is that the transportation activity must be identical to
primary business of the firm to qualify as private carriers. E.g. Cement carriers, soft drink carriers
milk tankers etc.But off late companies are focusing more on their core business & often outsource
the movement of their goods to specialist firms dealing with transportation & activity.
3) Exempt Carriers: - These are not constrained by economic regulation. The traditional exemption is
for specific commodity hauled or market served.
Conclusion:-For Logistical system design, the distribution between transportation formats are very
narrow. Main consideration is
? Operating Restriction
? Financial Commitments
? Operating Flexibility
Supplier of Transportation Services: - Transportation services are offered by a combination of
suppliers.
Single Mode operators: - It is the most basic carrier types, it utilize only one transport mode. It is
highly specialised, competent & efficient. However the approach creates significant difficulties for inter –
modal transport because it requires negotiations & a transaction with each individual carrier. E.g. Air
carrier for both freight & Passenger services since they operate Airport to Airport, Shipper or passenger
in responsible for movement to & from Airport. A series of single mode operations require more
management effort & thus increase in cost
Single Mode operators Many times common carrier were unable to provide a reasonably priced small
shipment services becomes of significant over head cost associated with terminal & time haul services.
Overhead cost led to minimum services charge on any small load. As railways do not take small
shipment & high “Min Service Cargo “by other modes, opportunity occurs to companies to offer
specialized services for shipment. Package services are an important part of transportation
infrastructure. This service is increasing day by day in domestic & international market. Package
services classification provides both Regular & Premium transportation.
7
Characteristics of these are:-
1) Basic Package Services (BPS):- Here Package delivery services is within commercial zones
of metropolitan areas. E.g. Indian Postal Service, Roadways Package Service for magazines,
daily newspaper etc.
2) Premium Package Services (PPS):- E.g. Courier services giving next day, seasonal day,
priority delivery services.
Inter Model operators: - These are multiple modes of transportation to take advantage of the
________ economics of each & thus provide. Integrated services at the lowest cost. The various forms
may be
? Integrated Rail & Motor Transportation called Piggyback e.g. trucks on goods train to Goa form
Mumbai.
? Technically it is possible to integrate all mode of transportation e.g. Piggyback, Fishy back,
tranship, Air truck etc.
For each intermodal combination the objectives is to integrate the most advantage our characteristics of
each mode to achieve optimal performance e.g. motor – Rail combination.
Intermodal Examples: - Piggyback/ TOFC/ COFC/ Road trailer
TOFC – Trailer on a flat car
COFC – Container on flat Car
Trailer / Container are placed on a flat car of rail & is moved. Trailer can be of different length while
height & ____________________
Container is 8’ wide, 8 height & 20’ or 40’ long. Line haul cost is expenses of moving rail cars or trucks
between cities.
TOFC concept facilitates direct transfer between rail & motor carriage.
Placement of trailer with wheels can lead to
? Wind Resistance
? Damage
? Weight problem
However container can be transferred to water carriers, allowing access to multiple modes.
Containership: - Fishy back train ship & Containership are oldest form of inter modal
transport. They utilize waterways which is one of the cheapest modes for line haul
movement. Container services could be door to door, port to port, port to door etc.
Co-ordinated Air & Truck: - Small Air craft carry small size load, to big / small cities to small
cities. Freight are generally envelops, small parcels & after these reaching small cities are further
carried by small trucks to desired locations. These are highly profitable services e.g. Courier Air craft of
DHL, First flight, Blue Dart etc
Nôn operating Intermediaries: - These are basically broken without having any mode
with than e.g. are
8
Freight forwarders
Freight 1
Freight 2
Freight 3
Freight 4
(These are small size freight)
To Receiver
Shipper Associations / co operatives / Agent
Brokers ---- Intermediaries that co ordinate transportation arrangement between shippers
/ consignee / carriers. Brokers having authorised by Government work on commission
basis. They many times provided more extensive services like shipment matching, Rate
negotiation, billing, tracing etc.
Freight
forwarder
Make a
big load
Forward to
Destination
Destination B
doc_997188897.pdf
m com projcet
1
TRANSPORTATION INFRASTRUCTURE
In India is the last one decade or so all the business drivers have taken transportation as a major
activity. Earlier it was taken as back end activity.
Today any firm can consider following for movement of its product
1. Put transportation
2. Contractual agreement with many transportation services providers
Services option
o Changes in billing
o Information availability
o Product liability
o Pick up / delivery practices
Carriers / Transporters have flexibilities to negotiate responsibility for all transportation related activity.
Transportation Functionality
Two function: - 1) Product Movement & 2) Product Storage
1) Product Movement :- Product in any form i.e. Material, Component, Assemblies, work in
process or finished goods, transportation is necessary to move it to next stage of marketing
process or physically closer to ultimate customer.
A Primary transportation is product movement up & down value chain. This in transit goods is
very critical for JIT, & Quick response practices reduces manufacturing & distribution centre
inventories,
Financials of transportation
Transportation is a cost, It does not add to profit line. So the best practise in transportation
management may be saviour of the bottom line cost.
Transportation Cost is
? R & M Cost
? Fuel Cost
? Driver Cost
? Overhead Cost
? Alignment Cost
? Cost of Product _____
Major objectives of Transportation
Move Product Original Location Prescribed Location with minimal Temporal? In Transit
Financial
Environment
Apart from this loss & damage expenses of product during transportation should be minimized.
2) Product Storage: - There may be temp storage facility. At times in transit product storage
on which may be cheaper than unloading / Loading from ware housing to vehicle for further
movement. In essence in many cases the transportation vehicle may be used as a storage
facility it unloading , placing in warehousing , reloading cost is high
A second method to achieve the second storage facility is to direct product from one location to
other. Though product storage in transportation vehicle can be costly, it may be justified from total
cost or performance perspective when loading or unloading cost, capacity constraint or ability to
expand lead times are consider
Cost
2
Transportation Principles
A) Economy of Scale & B) Economy of Distance
A) Economy of Scale
1) Cost per unit of weight when size increase & vice verse. Full Track Load & cost per unit of
scale would be less wrt to not full truck load.
2) Larger capacity goods mover system has very low cost per unit .e.g. Indian Railways, Cargo
Ships, Air Cargo and so on. (Air Cargo for lighter & Costly items or urgent delivery item e.g.
critical spare parts, defence goods during hostilities etc). Here fixed expenses (salary, order
processing, Placing vehicle / mode for loading or unloading).this cost is fixed e.g. Business
house may move 1 bag of sugar or 100 bags, this cost will be same.
B) Economy of Distance: - Transportation cost decrease with increasing distance. It is known as
TAPERING Principle
These two principles are important when the objective of any transportation decision is to maximum the
size of the load & distance that it is shipped while still meeting customer services expectation.
Principles in Transportation Decision: - Transportation activity is different compared
to normal Buyers & sellers scenario. A Buyer negotiates the commercials of any product with Seller.
Both come to an understanding & deal is done. Government taxes, regulates etc are already
incorporated in the basic cost. It is mostly the many in on the basic cost which is negotiated.
Transportation transactions are influences by 5 parties.
1. Transporter (Originating Party)
2. The Consignee (Destination Party)
3. The Carrier (Operators Truck, Rail, Ship etc)
4. The Government
5. Public.
(A) Shipper & Consignee interested in
? Specified pick up 7 delivery time
? Predictable transit time
? Zero loss & damage
? Accurate & timely exchange of information & invoicing.
Goods Flows
Information Flow
Shipper, Consignee & Government Relation
(B) Carrier (Transporter)
? Transporter wants
? Maximise Revenue for transaction
? Minimise operation cost
Public
Government
Shipper Carriers Consignee
3
World try to minimise the operation cost of labour, fuel, R & M cost by asking for & Flexibility in pick up
& delivery time to allow individual loads to be consolidated into economic move.
(C) Government :- It wants
? Stable & efficient transportation environment to sustain economic growth.
? Efficient transportation to ensure that goods reach every part of the country so that shortages
do not occur & price remain under check. E.g. PL 480 wheat grain movement during draught
condition in 1967 in India.
? Carrier to offer competitive services vie a vie profitability.
Government involvement in this sector is in the force of
? Regulation ---- Market which they can services
? Promotion ----- By setting R & D facilities
? Ownership ---- e.g. Railway good carries Road transportation by J & K Government.
These controls allow Government to have a major influence on the Economic success of regions,
industries or firm.
(D) The Public :- Public is Concerned with
? Accessibility
? Cost of Transportation
? Effectiveness
Micro interest is between shippers, Consignee & carriers.
Macro interest is between Governments & Public.
Transportation Infrastructure: - It Consist of
? Rights of way
? Vehicles
? Carriers organisations that offer transportation services on a for hire or internal basis.
Their existing infrastructure available drives.
Modal Characteristics: - Basic transportation modes are:-
? Rail
? Highway/ Road
? Water
? Pipeline
? Air
Importance of these modes is measured in terms of
? System mileage
? Traffic Volume
? Revenue
? Nature of traffic composition
Rail Network: - Railways handle largest number of tonnage with the increase in rail network in India is
the last 100 yrs or so, it has serviced transportation including to maximum by and large all cities &
________ level points are connected. Railways handle following type of loads
? Bulk Loads
? Small Loads
? Piecemeal consignment
? Special Loads
? Perishable loads
4
? Heavy Load / Less cum Volume
? Lighter Load / more Cum Volume
Railways handle significant intercity tonnage & revenue due to its capability to transport efficiently
larger tonnage. Rail road operation incur high fixed costs due to
? Expensive equipments
? Right of way (own tracks)
? Switching yards & Terminals
Railroad experience relatively low variable operation cost. E.g. Steam Engine Diesel Engine
Electricity Engine .This changes decreased the railroad variable cost per ton per mile. Labour
management has further reduced the cost. Railways focus more for haulage of specific products e.g.
raw materials e.g. minerals, petroleum products, food grain, military hardware etc .In early 1980 IR got
into car load & container services. Car load is full wagon load to one party. Railway is more responsive
to specific customer needs.
Specialized services Railroad
? Unit trains
? Articulated Trains
? Double Deck Container
? Refrigerated Cars
? Liquid Transportation
? Gas Transportation cars & so on.
Motor Carriers: - Highway transportation has increased many told in the last decade in India reason for
this was
? Construction of Golden Quadrangle Delhi – Mumbai – Chennai – Calcutta
? Connectivity between District HQ
? Connectivity from District HQ to __________
? Connectivity from __________ to village
Investment in motor roads is low wrt Rail Drawback of motor carriers
? License fee, user fee, toll cost & these are directly related to over the road units. Worli Sea
Link?
? Variable cost in high, Reason, each unit is independently power driven, driver is _______ for
each unit.
? Labour requirement is high.
Motor carriers are low overhead fixed & __________ , R & M high variable cost operation.
Motor carriers are best suited to handle small shipments moving short distance. Characteristics of
motor carriers favour manufacturing & distributive trades, short distance & high value product.
Water Transportation: Oldest mode steamboats came into use in 1800.Diesel powered in 1920 two
types of water transportation.
? Deep water – Sea
? Navigable inland transportation – very less in India.
Advantage of Water transportation
? Capacity to move extremely large consignment
? Relatively safe.
Disadvantage of Water transportation
? Speed & Limited range of operation.
5
? Fixed cost is between Rail & Motor carriers.
For Water carrier Right of way is generally developed by Government. Some put operation also have
their infrastructure e.g. Reliance -------- for petroleum crude, Essar ----------- for steel, Cement etc.
Water transportation employee’s two types of vessels.
1) Deep Water vessels for Oceans.
2) Diesel towards barges for river & cannels.
Examples of Inland freight is missing & basic bulk commodities.
Inland water transportation acts as a warehouse in transit
Pipelines: - It is continuous movement of liquid, gas commodity operate 24 Hrs X 7 days. There is no
empty container or wagon or truck to be returned.
It has highest fixed cost / low volume cost, high fixed cost due to
(1) Right of way
(2) Construction & need of control station
(3) Pumping capacity.
However variable operating cost is very low. Goods shipped are gas, liquid, mineral slurry e.g. coal, iron
ore, etc.
Air Transportation: - it is least utilized mode
Advantage of Air transportation – Speed
However it is more of potential opportunities try than a reality.
Fixed Cost of Air transportation is low compared to Rail, Water & Pipeline .It ranks second only to
highway transportation mode. Fixed cost of Air freight is only cost of air craft & specialized handling
system equipment & cargo container.
Variable Cost is very high – fuel, maintenance, labour etc.
By & large Air transportation is used is used for emergency shipment.
Modal Classification: - It is done terms of historical development of model & intercity ton / mileage &
Fright Revenue .It is analyzed wrt to fixed & variable cost. Modal classification is arrived at by
comparing.
? Market Share
? Cost
? Traffic Composition
It also considers
? Fixed / Variable cost of each mode.
It also consider operating characterisation
? Speed
? Availability
? Dependability
? Capability
? Frequency
Speed: - Refers to elapsed movement time Air is fastest, water is slowest.
Availability:-Ability of mode to services any given pair of location Road transportation is the best in
this.
Dependability: - Variance from expected or Published delivery schedule. Pipeline transportation is
most dependable.
Capability: - It is the ability to handle any transport need i.e. load size
Frequency:- It is quantity of schedule movement. Pipeline is the best.
6
Cost Structure for each mode:-
1) Rail------ High Fixed Cost / Low Variable Cost
2) Highway ----- Low Fixed cost (highways are in place provided by public support, medium
variable cost (fuel, maintenance)
3) Water------- Medium fixed cost (ships/equipment), Low variable cost (capability to transportation
___________)
4) Pipeline ----- Highest fixed cost (Right of way, Construction, Requirement of control system,
pumping capacity) lowest variable cost (No Labour cost of any significance)
5) Air ------ Low fixed cost (Air craft & handling & cargo system). High variable cost (fuel,. Labour,
maintenance cost etc.)
Transportation formats (Contd) :-
1) Contract Carriers -------- Transportation services for select customer’s basis for contract is an
agreement between a carrier & shipper for a specified transportation services at a pre agreed cost,
contract may be for a single load or a number of loads over a time. Business agreement becomes
the basis for contract carrier to get a permit to transport the specified items. Petrol, LPG, GAS,
_________.Carrier may be owner operator e.g. Bottle carriers of soft drinking CNG, LPG etc.
2) Private Carriers: - It consists of a firm providing its own transportation. Private carriers are not fort
hire, but they must comply with regulation concerning hazardous goods movement, employee
safety, vehicle safety & any other social regulations put by law Government (R.T.O). The primary
distribution between private & for hire carriers is that the transportation activity must be identical to
primary business of the firm to qualify as private carriers. E.g. Cement carriers, soft drink carriers
milk tankers etc.But off late companies are focusing more on their core business & often outsource
the movement of their goods to specialist firms dealing with transportation & activity.
3) Exempt Carriers: - These are not constrained by economic regulation. The traditional exemption is
for specific commodity hauled or market served.
Conclusion:-For Logistical system design, the distribution between transportation formats are very
narrow. Main consideration is
? Operating Restriction
? Financial Commitments
? Operating Flexibility
Supplier of Transportation Services: - Transportation services are offered by a combination of
suppliers.
Single Mode operators: - It is the most basic carrier types, it utilize only one transport mode. It is
highly specialised, competent & efficient. However the approach creates significant difficulties for inter –
modal transport because it requires negotiations & a transaction with each individual carrier. E.g. Air
carrier for both freight & Passenger services since they operate Airport to Airport, Shipper or passenger
in responsible for movement to & from Airport. A series of single mode operations require more
management effort & thus increase in cost
Single Mode operators Many times common carrier were unable to provide a reasonably priced small
shipment services becomes of significant over head cost associated with terminal & time haul services.
Overhead cost led to minimum services charge on any small load. As railways do not take small
shipment & high “Min Service Cargo “by other modes, opportunity occurs to companies to offer
specialized services for shipment. Package services are an important part of transportation
infrastructure. This service is increasing day by day in domestic & international market. Package
services classification provides both Regular & Premium transportation.
7
Characteristics of these are:-
1) Basic Package Services (BPS):- Here Package delivery services is within commercial zones
of metropolitan areas. E.g. Indian Postal Service, Roadways Package Service for magazines,
daily newspaper etc.
2) Premium Package Services (PPS):- E.g. Courier services giving next day, seasonal day,
priority delivery services.
Inter Model operators: - These are multiple modes of transportation to take advantage of the
________ economics of each & thus provide. Integrated services at the lowest cost. The various forms
may be
? Integrated Rail & Motor Transportation called Piggyback e.g. trucks on goods train to Goa form
Mumbai.
? Technically it is possible to integrate all mode of transportation e.g. Piggyback, Fishy back,
tranship, Air truck etc.
For each intermodal combination the objectives is to integrate the most advantage our characteristics of
each mode to achieve optimal performance e.g. motor – Rail combination.
Intermodal Examples: - Piggyback/ TOFC/ COFC/ Road trailer
TOFC – Trailer on a flat car
COFC – Container on flat Car
Trailer / Container are placed on a flat car of rail & is moved. Trailer can be of different length while
height & ____________________
Container is 8’ wide, 8 height & 20’ or 40’ long. Line haul cost is expenses of moving rail cars or trucks
between cities.
TOFC concept facilitates direct transfer between rail & motor carriage.
Placement of trailer with wheels can lead to
? Wind Resistance
? Damage
? Weight problem
However container can be transferred to water carriers, allowing access to multiple modes.
Containership: - Fishy back train ship & Containership are oldest form of inter modal
transport. They utilize waterways which is one of the cheapest modes for line haul
movement. Container services could be door to door, port to port, port to door etc.
Co-ordinated Air & Truck: - Small Air craft carry small size load, to big / small cities to small
cities. Freight are generally envelops, small parcels & after these reaching small cities are further
carried by small trucks to desired locations. These are highly profitable services e.g. Courier Air craft of
DHL, First flight, Blue Dart etc
Nôn operating Intermediaries: - These are basically broken without having any mode
with than e.g. are
8
Freight forwarders
Freight 1
Freight 2
Freight 3
Freight 4
(These are small size freight)
To Receiver
Shipper Associations / co operatives / Agent
Brokers ---- Intermediaries that co ordinate transportation arrangement between shippers
/ consignee / carriers. Brokers having authorised by Government work on commission
basis. They many times provided more extensive services like shipment matching, Rate
negotiation, billing, tracing etc.
Freight
forwarder
Make a
big load
Forward to
Destination
Destination B
doc_997188897.pdf