Introduction

Transportation confers ‘time utility’ and ‘place utility’ to the product; it determines the company’s customer service; it also has a crucial bearing on the other elements of physical distribution and marketing, like warehousing, inventory control and channel management. Finally, transportation is also a very important cost element in most businesses.

Main Tasks in Transportation Management

• Main Tasks in Transportation Management
• Assessment of the transportation requirement
• Choosing the ‘mix’ of transport modes
• Deciding the routing
• Development of operational plans
• Implementation/review
• Control of transportation costs

Basically transportation management involves decisions on:

• How much to move?
• When to move?
• Where to move?
• By what mode, or combination of modes to move?

The considerations in making these decisions are:

• the lead time for stock replenishment
• sales expected in the territory in the intervening time
• The normal cycles of inventory build up at the warehouse/ dealer points.

If a firm can estimate these factors fairly accurately, it can make the basic decisions on transportation. In a fundamental sense, transportation has to be based on the sales forecast. Decisions on when to move, how much to move and where to move will essentially depend on the sales forecast.