Definition of transport in logistics management

Transportation is basically the movement from one location to another as it makes its way from the beginning of a supply chain to the customer‘s hands. Transportation not only ensures movement of people but also goods from one place to another thus assisting the economy in the growth of trade and commerce. Being one of the most visible elements in the logistics operations, this function has gained a lot of importance and interest from the logistics perspective.

Transportation plays an important role in each and every supply chain because products are usually not produced and consumed in the same location. The third P in the marketing mix, ‗Place‘ is of importance here. In fact, transportation costs occupy a significant part of the total costs in most supply chains.

With the growth in industry and commerce, transportation facilitates in achieving the social and economic objectives. As times are changing and according to the requirements, the mode of transportation is changing to keep pace with the growth of science and technology across the globe. The degree of sophistication of the various transportation equipment in use varies according to the level of economic condition and growth of any particular region / country. As the economy has transformed from subsistence agriculture to commercial agriculture, and also with the spurt of manufacturing activities, the scope of development of transportation modes has
widened. In the olden days, the various modes of transportation like human beings, camels, horses, donkeys, carts and ships were being used. Today, these have paved way to newer modes of transportation to suit the needs of the modern world. In spite of the emergence of sophisticated modes of transportation, older modes continue to serve the society, but in a smaller way.

Transport, being the main component of logistics, plays an important part in all management decisions within the organization, from strategic decisions to everyday operations. Day to day management decisions also relies on transport, as ―Just in Time‖ methods for both production and distribution have become the standard. With the growth in e-commerce, resulting in more and more home delivery of products, transportation costs have become very significant in retailing. Especially for products sold online, transportation cost is a larger fraction of the total delivery cost.

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