This document summarizes various modes of transportation including road, water, rail, air, and pipeline. It discusses the strengths and weaknesses of each mode. It also discusses concepts like intermodal transportation, cross-docking, milk runs, and factors that influence freight costs. The top 15 logistics companies in India are listed along with their services and revenues. Sample contract contents and freight costs for land and ocean transportation are also provided.

1. Transportation
MMS (OPERATIONS)
PRESENTED BY :- SHAHRUKH SHAH

2. Major Transportation Modes
• Road
• Water
• Rail
• Air
• Pipeline

3. Road Mode
Strengths
• Flexibility to pick up and
deliver where and when
needed
• Often the best balance
between cost/flexibility and
delivery reliability/speed
• Can deliver straight to the
customer (increasing)
• Can be available 24/7
Weaknesses
• Not the cheapest
• Weather Sensitive

4. Water Mode
Strengths
• Highly cost effective for
bulky items
• Works best for high weight-
to-value items
• Most effective when linked
into multimodal system
Weaknesses
• Limited locations
• Relatively poor delivery
reliability/speed
• Often limited operating
hours at docks

5. Types of Vessels
• Breakbulk Freighters
• Container Ships
• RORO
• Bulk Freighters
• Tankers
• Seagoing Barges

6. Rail Mode
Strengths
• Highly cost effective for
bulky items
• Can be most effective when
linked into multimodal
system
Weaknesses
• Limited locations, but
better than for water.
• Better delivery
reliability/speed than water
Increasing part of multimodal solutions, dual tracks on major routes

7. Air Mode
Strengths
• Quickest delivery over
longer distances
• Can be very flexible when
linked to highway mode
• Works best for low weight-
to-value items
Weaknesses
• Often the most expensive,
particularly on a per pound
basis

8. Air Cargo Rates
• General Cargo: Available for many commodities
• Class Rate: Used to attract freight and allow shippers to
penetrate markets (generate demand)
• Container Rates: Cost based, often discounted based on
number of containers on a route

9. Pipeline
• Initially used to feed other modes (rail)
• Common carrier
• Move more than 20% of intercity freight
• Growth peaked in 1988
• Primarily oil (60%) and natural gas
• Efficient (specific commodities),
• Low damage risk
• Low cost
• Limited geographic coverage, one-way
Truck
Rail
Air
Water
Pipeline

10. Advantages and disadvantages of five modes of transportation

11. Modal Shares of Shipments
Air Motor Pipeline Rail Water
Cost per
ton-mile
$0.425 $0.219 $0.011 $0.027 $0.0074
Operating
Ratio
high 80s 93 - 95% mid 50s low 70s 92 - 95%
Volume
Carried
0.1% 40.5% 16.3% 26.3% 16.8%
Speed 400 mph 40 mph 5 mph 20 mph 5 mph
Competitors Motor Air or I/M
Rail
Water Water,
Pipeline, or
Motor
Rail or
Pipeline
Type of
Freight
High
Value
Varies
widely
Petrol or
Slurry
Low value,
Bulk
Low value,
Bulk

12. What is Intermodal Transportation
• The use of two or modes of transportation in moving a
shipment from origin to destination
• Mostly associated with “piggyback”
or container shipments
• Combines advantages (and
disadvantages) of each mode used
• Reduces risk of theft and loss
• Shortens customer order cycle time
and effectively reduces costs
• Promotes “seamless” product
movement: Eliminates unnecessary handling

13. Containerization
• Significant growth during Vietnam
War
• Improves efficiency, protects
materiel, reduces handling &
pilferage
• Sizes: 20 ft (TEU) or 40 ft (FEU)
• Shorter to permit multiple units on
railcars

14. Growth of Intermodal transportation
• Deregulation
– Removed barriers to modes working together
• Global business
– Off-shore sourcing of goods
• Changes in business environment
– Higher operating costs
– Driver shortages
– Increased competitive pressures

15. Cross Docking
Practice of unloading products from
suppliers, sorting products for individual
stores, and quickly reloading products
onto trucks for a particular store.
Practice of unloading products from
suppliers, sorting products for individual
stores, and quickly reloading products
onto trucks for a particular store.

16. Cross Docking
• Popularized by Wal-Mart
• Warehouses function as inventory coordination
points rather than as inventory storage points.
• Goods arriving at warehouses from the
manufacturer:
– are transferred to vehicles serving the retailers
– are delivered to the retailers as rapidly as possible.
• Goods spend very little time in storage at the
warehouse
– Often less than 12 hours
– Limits inventory costs and decreases lead times

17. Issues with Cross Docking
• Require a significant start-up investment and are very difficult
to manage
• Supply chain partners must be linked with advanced
information systems for coordination
• A fast and responsive transportation system is necessary
• Forecasts are critical, necessitating the sharing of
information.
• Effective only for large distribution systems
– Sufficient volume every day to allow shipments of fully
loaded trucks from the suppliers to the warehouses.
– Sufficient demand at retail outlets to receive full truckload
quantities

18. Cross-Docking Distribution Center
Suppliers
Customers
Receiving
Shipping
Sorting
Distribution Center Before Cross-Docking
LTL
Suppliers
Customers
After Cross-Docking
TL
TL
Cross-Docking
DC

19. Transshipment
• Shipment of items between different facilities
at the same level in the supply chain to meet
some immediate need
• Occurs mostly at the retail level
• Can be achieved:
– with advanced information systems
– Shipping costs are reasonable
– Retailers have same owner

20. Milk run
• A milk run, in logistics, is a round trip that facilitates either distribution or
collection.
• On the round trips are either goods collected from several suppliers and
transported to one customer, or goods collected from one supplier and
transported to several customers. In contrast to the groupage traffic, there is no
handling, except to transport the goods.
• Something more specialist, the Milk-run is described as a concept that is a
sequential collection of goods from multiple sources and the direct service to the
customers without intermediate handling features of the goods.

21. Milk run

22. Benefits of Milk run
• Higher utilization of trucks and the resulting reduction of transport costs
• the reduction of stock, both at the supplier side and at the customer side
• high security planning and integration of reusable container recycling
• reduction of pollution of the environment, both by consolidation and the resulting
higher utilization of trucks, and by the reduction of transportation vehicles
The disadvantages of the Milk run are the following:
• Not all suppliers are able to implement a milk run.
• The increasing dependence on road conditions.
• In the case of poor planning, the number of extra trips can increase, and lead to
additional costs.
“Milk run” has been used to describe multi-stop scheduled passenger airline
flights involving direct, no change of plane service where a number of different
stops are made en route by the same aircraft using the same flight number.

23. Freight management
Cargo typeCargo type
CostCost
DeliveryDelivery
Freight
Management
Freight
Management
Shipment SizeShipment Size
Vehicle
Schedule
Vehicle
Schedule
Route SelectionRoute Selection
Transportation
mode
Transportation
mode
Urgency at
Consignee End
Urgency at
Consignee End

24. Freight Management
• Effective utilization of appropriate transportation mode with lower social
costs
• Improve Scheduling and routing to reduce freight, vehicle load ( e.g avoid
empty trips)
• Organized delivery systems by using load consolidation to distribute goods
• Minimize excessive packaging and delivery frequency
• Encourage efficient freight transport Equipments
• Improve vehicle operator training to encourage more efficient and safe
driving

25. Factors influencing Freight Cost
• Volume – Cost of operations is distributed over large volumes and directly
proportionate to lower per unit cost of cargo movement
• Distance- Variable cost directly proportional to distance covered
• Product Density – Freight cost depends on per unit volume of the product – no
limitation on low density products contrary high density products limitations on
weight. (Weight should not exceed payload of the vehicle
• Product Shape- Size and Shape of product influence freight cost –heavy odd
shaped products are moved using long trailers increasing cost
• Product Handling – Equipments viz cranes are required to load and unload heavy
as well as odd shaped cargo, transportation and organization of these equipments
adds cost to final product
• Product Type- Perishable foods , vegetables, fruits, pharmaceutical products
require to be transported under special temperature and humidity conditions
through refrigerated containers increasing operating cost as high as 3-4 times

26. Cargo Movement by Sea- Air Mode- Case Study
• A consignment of 1000 Kgs to be moved from Mumbai to London.
Method 1
By air Mode- Cheapest airline costing will be approx 1,55,000. Cargo is required to
be kept ready and moved to airport 24 hrs prior to departure
Method 2
By Sea- air Mode- Freight cost by sea to Dubai is approx 10,000 including all
charges, and air freight from Dubai to London is Rs 70,000.
Since Dubai is hub and volume cargo is always available the freight rates come
down.
In above case shipping cost is almost half then using a single method.

27. Transportation Networks
• Point-to-point Network – Common for Long distance- Point of origin and
destination are fixed, assured full truck loading
• Multiple Delivery Point- Round trip operations- delivery of filled bottles and pick
up of empty bottles
• Trans-Shipment Points- Consignment from long distance fleet is trans-shipped to
local vehicles for distribution across local areas
• Nodal Network- Consolidation of goods at freight stations further to be loaded in
respective destinations containers and moved to port terminals
• Hub- and-Spoke Network-

28. Contents of Contract & Freight Cost- Land
• Scope of Work/General responsibilities
• Policy for Shortage/damages/insurance
• Validity of contract
• Payment Terms
• General Terms
• Applicability
• Disputes
Sample Contract Contents
Sample Freight Cost for 16 MT Vehicle from Khurda to Various locations
Microsoft Office
Word 97 - 2003 Document
Microsoft Office
Excel Worksheet

29. Contents of Contract & Freight Cost – Ocean
• Scope of Work/General responsibilities
• Validity of contract- Commencement and Duration
• Rates
• Payment Terms
• General Terms
• Applicability
• Disputes
Sample Contract Contents
Cost sheet- With Price breakdown
Adobe Acrobat
Document
Microsoft Office
Excel 97-2003 Worksheet

30. Transport freight check
Check Freight rates for various destinations
• www.truckbhada.com
• www.thetransporter.in
• https://freightbazaar.com

31. Top 15 Logistics companies in India
Sr.No Company Revenue Service Employees Headquarters Website
1 DHL $25 Billion- $ 30 Billion Logistics, Courier, Supplychain
2,75,000-
3,00,0000 Germany www.dhl.co.in
2 Bluedart 1000-2000 Crs Logistics, Courier, Supplychain 3000-5000 Chennai
www.bluedartaviation.c
om
3 TNT express $12 billion to $15 billion
Logistics, Courier, freight delivery services, charter
airline and Supply Chain 69,000 to 70,000
Hoofddrop,
Netherlands www.tnt.com
4
Agarwal Packers and
Movers
Rs 8000 million to Rs 10,000
million Transport of household goods, logistical services 4000 to 5000 New Delhi, India
www.agarwalpackers.co
m
5 UPS (united parcel service) $55 billion and $800 million
Courier express, freight forwarding, logistics
services.
300, 000 to
400,000 Seattle, Washington www.UPS.com
6 FedEx $42 billion to $45 billion
Post delivery, express mail, freight forwarding, third
party logistics 300,000+ Memphis, Tennessee www.fedex.com
7 DTDC 2000 to 3000 Courier express, freight forwarding, logistics services 2000 to 3000 Mumbai, India www.dtdc.in
8 Gati
Rs 12895 million to Rs 13000
million Courier express, freight forwarding, logistics services 3000 to 5000 Chennai www.gati.com
9 Aegis Logistics Ltd Rs 1500 crore to Rs 2000 crore Courier express, freight forwarding, logistics services 2000 to 3000 Mumbai, India www.aegisindia.com
10 All cargo logistics ltd
Rs 42,711 million to Rs 45,000
million Courier express, freight forwarding, logistics services 2500 to 3000 Mumbai, India
www.allcargologistics.c
om
11 First flight courier Ltd Rs 1500 crore to Rs 2000 crore Courier express, freight forwarding, logistics services 10, 000 to 15,000 Mumbai, India www.firstflight.net
12 The Globe Express Service $ 500 million to $ 1 billion
Cargo consolidation & distribution, warehousing and
specialty handling services 5000 to 10,000 Mumbai, India www.globeexpress.com
13
Container Corporation of
India Rs 14,800+ Crore Freight and Cargo by train and ships 5000 to 10000 New Delhi, India www.concorindia.com
14
Transport Corporation of
India Rs 434 crore to Rs 500 Crore Supply Chain, logistics and freight movement 5000 to 6000 Gurgaon, Haryana www.tcil.com
15 Aqua Logistics Rs 61 crore to Rs 65 crore Logistics and supply chain partner, delivering etc 2000 to 3000 Mumbai India www.aqualogistics.com

32. Questions