Physical Distribution

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  • Topic: Transport, Mode of transport, Intermodal transport
  • Pages : 17 (2035 words )
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  • Published : February 22, 2013
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Chapter
Chapter Systems and
Transportation 22
Services
Physical Distribution
• Section 22.1 Transportation Systems and
Services
• Section 22.2 Inventory Storage

Key Terms
physical
distribution
transportation
common
carriers
contract
carriers
private
carriers
exempt
carriers
ton-mile
carload
freight
forwarders

Transportation Systems and
Services
Objectives
Describe the nature and scope of physical
distribution
Identify transportation systems and services
that move products from manufacturers to
consumers

Name the different kinds of transportation
service companies

Marketing Essentials Chapter 22, Section 22.1

Transportation Systems and
Services
Study Organizer
Use a figure like this to list the advantages and
disadvantages of each type of transportation
system.

Marketing Essentials Chapter 22, Section 22.1

physical
distribution
Activities to
deliver the right
amount of
product to the
right place at the
right time.

The Nature and Scope of Physical
Distribution
Physical distribution X comprises all the
activities that help to ensure that the right amount
of product is delivered to the right place at the
right time.
Also known as logistics, physical distribution
involves:
• Processing
• Transporting
• Storing

• Stock handling
• Inventory control
Marketing Essentials Chapter 22, Section 22.1

Types of Transportation Systems
transportation
The marketing
function of
moving a
product from the
place where it is
made to the
place where it is
sold.

Transportation X is the marketing function of
moving a product from the place where it is made to
the place where it is sold. Its costs are a significant
part of each sale, so both manufacturers and sellers
look for the most cost-effective delivery methods.

Marketing Essentials Chapter 22, Section 22.1

Trucking

Trucks, or motor carriers, are the most frequently
used transportation mode. They carry goods with
short shelf lives and ones that are expensive for a
business to keep in inventory.

Marketing Essentials Chapter 22, Section 22.1

Trucking

State and federal transportation agencies regulate
motor carriers used for interstate (between states)
commerce. The laws cover how long a driver can go
without stopping and other safety issues.

Marketing Essentials Chapter 22, Section 22.1

Trucking

Businesses that use trucks to move their products
have several different options:
• For-hire carriers
• Private carriers
• Combination of both
For-hire carriers include:
• Common carriers
• Contract carriers

Marketing Essentials Chapter 22, Section 22.1

Types of Transportation Systems
common
carriers
Trucking
companies that
provide
transportation
services to any
business in their
operating area
for a fee.
contract
carriers

Common carriers X provide transportation services
to any business in their operating area for a fee.
More than one-third of all motor freight is handled by
common carriers.
Contract carriers X are for-hire carriers that provide
equipment and drivers for specific routes, according
to agreements between the carrier and the shipper.
Their fees differ from customer to customer.

For-hire trucking
companies that
provide
equipment and
drivers for
specific routes.
Marketing Essentials Chapter 22, Section 22.1

Types of Transportation Systems

For-hire carriers are good to use because they
provide their own equipment, but they offer less
flexibility for:
• Special pickups or handling
• Rush deliveries

• Direct shipments

Marketing Essentials Chapter 22, Section 22.1

Types of Transportation Systems
private
carriers
Trucking
companies that
transport goods
for an individual
business.

Private carriers X transport goods for an individual
business. The equipment can be owned or leased to
meet the specific transportation needs of the
business. Starting a private carrier operation requires
a...
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