Impact of Product Characteristics

Impact of Product Characteristics

Let’s learn more about impact of product Characteristics. One of the major factors to be considered when planning for logistics is, perhaps not surprisingly, the product itself.

For the logistics planner, the physical characteristics of the product and package are seen to be of great significance. This is because, in distribution and logistics, we are directly concerned with physical flow movement and storage. The physical characteristics of a product, any specific packaging requirements and the type of unit load are all-important factors in the trade-off with other elements of distribution when seeking least-cost systems at given service levels. This potential for trade-off should continually be borne in mind.

 Few product characteristics impacting the development and operation of a distribution system are

Volume to weight ratio

A low ratio of volume to weight in a product (such as sheet steel, books, etc) generally means an efficient utilization of the main components of distribution. Thus, a low-volume/high-weight product will fully utilize the weight-constrained capacity of a road transport vehicle.

 On opposite, a high volume to weight ratio, tends to be less efficient for distribution. Typical products include paper tissues, crisps, disposable nappies, etc. These products use up a lot of space, and are costly for both transportation and storage.

Value to weight ratio

High-value products are more able to absorb the associated distribution costs. It is oft en essential for low-value products to have an inexpensive distribution system, as otherwise the effect on the total cost of the product might make it non-viable in terms of its price in the marketplace.

 It is useful to assess the value effect in terms of a weight ratio: the value to weight ratio. Low value to weight ratio products (eg ore, sand, etc) incur relatively high transport unit costs compared with high value to weight products (eg photographic equipment, computer equipment, etc).

High-risk products

The characteristics of some products present a degree of risk associated with their distribution (perishability, fragility, hazard/danger, contamination potential, and extreme value). The need to minimize this risk (sometimes a legal obligation) means that a special distribution system design must be used.

Packaging

The packaging of a product is broadly determined for product promotion and product protection, the latter being the function that is particularly pertinent to logistics. There are also some other factors that need to be considered when designing packaging for logistics purposes. In addition to product protection, packages should be easy to handle, convenient to store, readily identifiable, secure and of a shape that makes best use of space – usually cubic rather than cylindrical.

 Once again, there is trade-off s that exists between these factors. These trade-offs will concern the product and the logistics operation itself. It is important to appreciate that, for those involved in logistics, the package is the product that is stored and moved and so, where possible, should be given the characteristics that help rather than hinder the logistics process. Packaging is very much a part of the total logistics function, and the design and use of packaging has implications for other functions such as production, marketing and quality control, as well as for overall logistics costs and performance.