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PHYSICAL DISTRIBUTION

TRANSPORTATION

MEANING- PHYSICAL DISTRIBUTION

Physical distribution is the set of activities concerned with efficient movement of finished goods from the end of the production operation to the consumer. Physical distribution is part of a larger process called "distribution," which includes wholesale and retail marketing, as well the physical movement of products. The importance of physical distribution is also based on its relevance to customer satisfaction.

COMPONENTS

Physical distribution can be viewed as a system of components linked together for the efficient movement of products. Small business owners can ask the following questions in addressing these components: Customer serviceWhat level of customer service should be provided? TransportationHow will the products be shipped? WarehousingWhere will the goods be located? How many warehouses should be utilized? Order processingHow should the orders be handled? Inventory controlHow much inventory should be maintained at each location? Protective packaging and materials handlingHow can efficient methods be developed for handling goods in the factory, warehouse, and transport terminals? These components are interrelated: decisions made in one area affect the relative efficiency of others.

EXAMPLE:

For example, a small business that provides customized personal computers may transport finished products by air rather than by truck, as faster delivery times may allow lower inventory costs, which would more than offset the higher cost of air transport. Viewing physical distribution from a systems perspective can be the key to providing a defined level of customer service at the lowest possible cost.

COMPONENTS TRANSPORTATION
MEANING: Physical distribution of goods and services require transportation. Transportation means physical movement of people and goods from place to place. Transportation plays a vital role in marketing. Transportation helps in the physical movement of goods from the production centers or point of origin to the consumption centers.

FUNCTIONS OF TRANSPORTATION

Widens Market-by bringing the producers, distributors, and consumers closer to one another. Increases Mobility Of Labor And Capital -physically transported from one place to another. Creates Time And Place Utility-Transportation facilitates physical movement of goods from one place to another. Goods are made available at the time of consumers need. Employment Opportunities-uses a lot of people while carrying out its functions. Transformation Of The Economy-also develops modern industry as well as production of agricultural products. This leads to increased productivity resulting transformation of the economy. Large Scale Of Production-helps in distribution of the products on a large scale. As markets continue to widen, production capacity has to be increased. This leads to large-scale production and reduction in cost.

Overall Economic Development-The development of transportation

is part and parcel of economic development. It stimulates the development of other sectors of the economy like agriculture, industry and tourism. Even perishable products can be delivered to the markets with greater speed using transportation.
Price Equalization-Transportation helps in supplying products to

the consumers when it is demanded. The excess supply from one location can be transported to places where the demand is high. As a result, scarcity is avoided and price fluctuations are controlled.
Encourages Job Specialization And Division Of Work

Transportation facilitates regional and geographical concentration of labor and production centers. As a result, labor becomes specialized, i.e. transporters. Transportation also facilitates in producing goods and services as desired by the consumers. This leads to specialization.

Road Transportation Rail Transportation Water Transportation Air Transportation

ROAD TRANSPORTATION

Road transportation is the oldest and best form of transportation. Through road transport, people and goods can be transported to different destinations. Road transportation is convenient and relatively fast. It can be used for door-to-door delivery of the products. FEATURES: Small Investment, Multipurpose, Freedom Of Movement, Door-to-door service, Economy Of Time

ROAD TRANSPORTATION
ADVANTAGES

DISADVANTAGES Unsuitability Less Speed Unreliable Unstable freight

Flexibility Economy Convenience Feeder Services Delivery In Good Condition Safety Rural Development Suitable For Perishable Products

Rail transportation or railways are the cheapest mode of transport around the world. Rail transport is owned and operated by the governments of each country. They are more reliable compared to road or water transportation. Railways are popular and widely used transport system. Railways could be meter gauge or broad gauge depending on the capacity, speed and the traffic.

FEATURES: Monopoly, Huge Investment, Specific Infrastructure, No Uniform Pricing , Large Carrying Capacity.

RAIL TRANSPORTATION
ADVANTAGES DISADVANTAGES

Suitable For Bulky Products Greater Speed Cheaper Dependable And Regular Services Safe Carrier Flexible Carrier

Heavy Investment Costly Inflexible Unsafe For Perishable Products Unsuitable For Rural And Hilly Areas Evils Of Monopoly

WATER TRANSPORTATION

Water transport includes river, oceans and canals as a means of transportation. It is the oldest mode of transportation. Water transportation is used for bulky products, which have low unit price. Water transportation is cheaper than other modes of transportation but is extremely slow. Water transport does not require heavy capital investment because the ships and boats can travel over natural waterway. FEATURES: Natural Waterway, Little Power Consumption, Low Operational Cost, Flexibility, Slow Movement

WATER TRANSPORTATION
ADVANTAGES

Cheapest Large Carrying Capacity Safer International Trade

DISADVANTAGES

Slow Speed Limited Area Of Operation Seasonal Difficulties Risky Unsuitable

AIR TRANSPORTATION

Air transportation is the most advanced mode of transport. It has reduced the distance between countries and tourism industry has flourished. Air transportation is the fastest mode of transport and used mainly for travel by people and carrying mails. It is helpful in supplying relief services in time of emergency like floods or earthquakes and war. Air transportation has created time utility in both national and international markets. It links different parts in the country and the cities in different countries.

FEATURES: High Speed, Unbroken Journey, Expensive, Extensive Network.

AIR TRANSPORTATION
ADVANTAGES

Highest Speed Boon To Perishable Product Regular, Comfortable and Punctual Shortest Route Access To All Areas

DISADVANTAGES

Expensive Uncertainties and Unreliable Limited Capacity High Construction And Operational Cost Accidents

THANK YOU
PRESENTED BY: ANCY GEORGE

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