Term
| Intermodal Transportation |
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Definition
The use of two or more modes to move a shipment from origin to destination.
-Malcom McLean first move freight by truck and rail in 1950 |
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Term
| Growth factors of Intermodal Transportation |
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Definition
Deregulation
Growth of global business
Increasing truck operating costs
Driver shortage
Development of information technology
-1700% growth since 1957
-100% increse in container loadings sice 1988.
>1/2 of goods moved in containers
25% of freight shipments in excess of 500 miles. |
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Term
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Definition
Truck-Rail intermodal service: movement of TOFC or COFC.
-Lower rates than all truck plust faster transit time
-combines truck accessibility and long haul/volume traffic benefit of rail. |
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Term
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Definition
Two containers are loaded onto one flatcar; provides operating efficiency and lower cost
-Impact of rail mergers: longer rail haul means fewer interchanges. |
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Term
| Road Railer- New technology |
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Definition
| Special rail wheel set to haul trailers withot the use of flat car. |
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Term
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Definition
Big box made of steel w/o wheels.
-Adv. less handling, less damage, reduce pilferage, compete in shorter distance haul, unitizes freight, easy loading/unloading.
DisAdv. High cost of purchase/rental/repair, idle storage and empty backhauls, not always compatible w/products.
-20ft to 40ft lengths measured in TEU and FEU
-On dock rail service: direct load/unload b/t ship and railcar. |
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Term
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Definition
Connect buyer and seller- Use of outside firms (outsourcing) to provide own logistics support. Firms: Info-based...freight bill payment, auditing.
Asset and operation-based: in/outbound transportation, warehousing... |
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Term
| Growth in Third Party Logistics |
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Definition
Focus on core competiencies, cost reduction, flexibility, increased customer service.
DisAdv. No contro, employee morale |
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Term
| Surface Freight Forwarder |
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Definition
"person" that offers itself to the general public to provide transportaiton or property. (Shipper and Carrier)
Pickup-Consolidation-Line haul-Breakbulk- delivery
-Must issue a Bill of Lading(B/L) to shipper: assume responsibility and liability of cargo. |
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Term
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Definition
Middleman b/t shipper and carrier
Can represent shipper and carrier
Act as sales forces for carrier
*difference* Do not issue bills of lading
Do not maintain a cargo liability insurance. |
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Term
| Shippers' Associations, Shipper's Agents and Consolidators, and Intermodal Marketing Companies (IMC's) |
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Definition
Non-profit cooperative consolidators or distributors for member firms. Act as forwarders/brokers for members.
Arrangers of intemodal transportation.
Owner Operators- daddy's truck. |
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Term
| Benefits of using Owner operators...problems??? |
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Definition
| Flexibility benefits but reliability problems |
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Term
| Revenue Distribution of household goods industry |
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Definition
10% goes to Corporate
50% goes to driver
25% goes to Pickup Agent
15% goes to Destination Agent |
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Term
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Definition
Canada, Japan, Mexico, UK, Germany, China Korea, Taiwan, Singapore, France
-Accounts for 70% of imports, 64% of exports
-Trade volume= 27% of GDP |
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Term
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Definition
-unimpeded flow of goods: Free Trade
-MFN most favored nation status
-enhance cross-border movmt |
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Term
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Definition
| US assembly operation along Mexican borders= no import dutes to bring back to US |
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Term
| Three kinds of ocean carriers |
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Definition
Liner Shipping- ply fixed routs on published schedule
Tramp Shipping- charter ships, lease based on time or voyage
Private Vessels-Ship registry; flags of convenience for regulations. |
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Term
| Four typs of Liner service |
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Definition
Break bulk
Container service
LASH service (lighter aboard ship)
RORO service (roll on/ roll off ship) |
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Term
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Definition
| used for tax, manning, and relaxed regulation |
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Term
| Internation Freight Forwarders/ ship brokers/ ship agents |
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Definition
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Term
| Non-vessel operating common carriers (NVOCC) |
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Definition
| act as a consolidator and domestic freight forwarder, inbound/outbound container arrangement |
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Term
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Definition
Land Bridge- containers moving between Far East and Europe via ship-rail-ship instead of all water thru panama canal
Mini Bridge- Far East to east coast or Europe to west coast w/ final destingation in US port city
Micro Bridge- Interior non-port cities. |
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Term
| Eurasian Landbridge? Global impact? |
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Definition
| Containers moving Far East Asia to Europe by rail instead of ship-rail-ship |
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Term
| Rate Making in Air shipping |
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Definition
International Air transport Association (IATA)- sets rates bases on value of service and cost of service.
Density= weight/cubic ft, standard density of air shipping =10.4lb/cubic ft.
if D < 10.4; use weight based on standard density (10.4). |
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Term
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Definition
| Calculated based on weight or measure (whichever is higher) |
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Term
| 3 forms of chartered ships |
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Definition
Voyage charter: similar to taxi, shop owner responsible for crew and operation
Time Charter: Rent vessel and crew for period
Bareboad or Demise charter: long period, chartering party responsible for crew and operation |
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Term
| UNCTAD liner code (40-40-20 rule) |
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Definition
40% each to trade partners
20% to third world ocuntry |
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Term
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Definition
| Bilateral agreements to establish airline freedoms or rights to provide certain types of services. |
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Definition
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Term
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Definition
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Term
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Definition
pricing according to cost incurred to serve.
-customer covers all costs, sellter sets prices to max profits. |
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Term
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Definition
Pricing according to product value or demand
-higher value of the product, the hiher the transportation price (risk of loss/damage..)
-Third Degree price discrimination: separate price for separate groups of buyers w/ same service.
must posses some monopoly power |
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Term
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Definition
Provides rate for any commodity between any two points.
1) Geographic: rate basis points and numbers
2)Commodity: commodity classification, class ratings
3)Rate structure: national scale of rates, cwt-based |
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Term
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Definition
1. Character of shipment rates: LTL/TL rates, muliple-car rates, incentive rates, unit train rates, density rates...
2)Area, location or route rates: Local rates, joint rates, proportional rates, differential rates, per mile rate...
3)Time/service rate structures: contract rates, deferred delivery rate.
4)Other rate Structures: Corporate volume rates, discounts, loading allowances, empty haul rates, menu pricing... |
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Term
| Factors affecting Pricing decisions |
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Definition
Market Forces (customers)
Governmental Controls
Other channel members
Competitio |
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Term
| 3 Categories of major pricing decision |
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Definition
1) Setting prices on new service- consider cost and market elasticity. no precedent
2)Modification of prices over time- respond to market/operating/service changes
3)Initiating and responding to price changes- impact on market share and profits. |
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Term
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Definition
| covering variable costs, volume and equipment utilization, and cash flow |
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Term
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Definition
| High price for price insensitive customers |
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Term
| Social responsibility pricing |
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Definition
| society and customer first |
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Term
| Price adjustment conditions |
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Definition
Discounts: reduction from published price. volume: TL vs LTL, Seasonal, Cash 2/10 net 30.
Geographical- FOB origin/destination
Uniform delivered pricing: zone pricing |
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Term
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Definition
| Free on Board- Origin(seller pays shipping costs); Destination (Buyer pays) |
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Term
| Mistakes in pricing strategy |
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Definition
1. over reliance on costs
2. slow reaction to market changes
3. ignoring marketing mix
4. prices not tailored to services and markets
5. need to price accoring to strategic plan |
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Term
| Carrier's Operational strategies to minimize cost |
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Definition
continuous straight line mvmt
Minimize intermediat handlings
Maximize the full capacity of equipment
Consolidation and break-bulk activities
Empty mileage should be minimized
Mvmt should be scheduled and dispatched. |
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Term
| Carriers Technological and Equipment strategies to minimize costs |
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Definition
Maximize the operational time of equipment
Fuel efficent speeds
Vehicle weight should be minimized
Standardized equipment
Equipment should be adapted to special market and commodity requirements |
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Term
| Benefits of hub and spoke system |
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Definition
Maximize the utilization of equipment
Increase the efficiency of equipment operations
Save transit time and operational costs |
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Term
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Definition
| less than 25 carriers handle 75 to 80% of total freight dollar |
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Term
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Definition
| few carriers handle more than 25% of total shipment, service disruptions problems if cease operation |
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Term
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Definition
| Main penalty is the cost of lost of sales by holding the shipment |
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Term
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Definition
| Consolidation of shipments to different destinations within the same general area |
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Term
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Definition
| Consolidate orders for several customers and stop along the way for partial unloading |
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