Running Head: TRANSPORTATION 1

Transportation

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Transportation plays a critical role in a product’s supply chain. The way transportation is

handled determines the efficiency of moving things from one place to another. Due to the

increasing trends of globalization and nationalization, the importance of transportation in the

management of logistics has grown tremendously. For industries, transportation ensures that

products are in the right place when and in the condition that the customers been them.

Transportation costs occupy more than a third of all logistics costs and affect the performance of

the entire logistics system in a huge way. Therefore, it is a necessity in the entire process of

production, to the time when the product is delivered to the end consumers and sometimes in

reverse logistics. Only an excellent coordination of transportation would yield benefits to the

fullest. Olive oil is one of the foods that are admissible for importation into the United States

from Italy. There are people who use it for pharmaceutical purposes while others use it for

cosmetic applications. Normally, olive oil is transported in tanks either by sea or by air in smaller

quantities.

For one to reduce the spoilage of the oil that is being transported, it is necessary to consider

all the factors which have the power to compromise its quality. It is quite delicate and highly

sensitive to heat and light. Therefore, it is important to keep the olive oil in the appropriate

containers. Most often, olive oil is kept in steel tanks which are in compliance with the laws

regarding oil production (Proietti, 2014). The steel tanks have several advantages. First, they

have the power to shield the oil from oxygen, moisture and light. Secondly, they keep the oil at a

constant temperature. Thirdly, they do not change the aroma or flavor of the oil. Thus, olive oil

can be kept in these tanks for long periods before they reach the destination to which they are

being shipped.

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Shipping of olive oil is undoubtedly the most dangerous stage in the whole process. Most

often, olive oil is already packed in glass bottled, if it is being transported in smaller quantities.

Glass bottles are quite fragile. Transporting can take months, if the mode of transportation is by

sea. Ideally, olive must be bottled using dark glass containers so that it is protected from

sunlight. The shipping takes place mainly in wintertime in order to reduce the risk that high

temperatures might spoil the oil (Proietti, 2014). However, this is not always the case because

most sellers of olive oil operate under specified demand rates. In the United States, olive oil

import trends have been quite high as shown in the graph below:

From the place where the oil is manufactured, it is transported by road to the nearest sea

port. For instance, if it is produced at the city of Rome, it is carried by road to the Port of Trieste

where it is loaded into ships for transportation to the United States. The problem with using road

tankers is that it is difficult to control temperatures; hence they can reach levels that would

compromise the olive oil quality (Banias, Achillas, Vlachokostas, Moussiopoulos, & Stefanou,
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2017). Even worse is when the oil is shipped by sea because the oil is carried inside containers

that are placed on the ship’s deck. There is a lot of heat from the sun and also the storms that

make the journey quite difficult. A simple transportation route map is shown below:

In the above map, A is the country of origin (Italy) while B is the destination (U.S.A).

There are various companies that can be used to transport olive oil from Italy to the United

States. For instance, DHL, UPS and FedEx are some of those companies that have actively been

operating in the international transportation and logistics industry (Herold & Lee, 2017).

Therefore, using UPS to transport the 5000 dozens of bottled olive oil would be an excellent

option because UPS has been prominent for effective transportation of products across national

borders. Furthermore, UPS has been certified to operate in many countries of the world including

Italy and the United States as it adheres to government regulations on what to transport.

The cost of transporting a 5 kg of weight using UPS is about 40 euros. This amount is

about 44 U.S dollars. Therefore, transporting 5000 dozens of bottled olive oil would amount to

about 200,000 dollars. There are many other costs that are involved. For instance, the costs of

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clearance at the port in the United States should also be included. There is also the aspect of

freight tax. Many countries including the United States impose taxes on goods carried by sea. In

some cases, bareboat and charter hire are also regarded as taxable income.

After the oil has arrived in the United States, say the port of Everglades, it is transported by

road to the Oklahoma City which is in the central part of the United States. Such transportation

also has its costs and risks. However, the transporting company must have several important

documents. For instance, the proforma invoice is required to indicate the particulars of the

product that is being shipped (Johnson & Bade, 2017). There is also the commercial invoice

which has the details of the product—olive oil and the transactions that have been involved.

Another important document is the packing list which the customs officials use to identify the

item location within the ship at the port. A certificate of origin could also be required.

In conclusion, transportation plays a critical role in the entire logistics system.

Transportation of olive oil from Italy to the United States would involve an efficient

transportation plan that would ensure that the goods are delivered on a timely basis. Furthermore,

olive oil is a delicate product that can be influenced by environmental factors such as light and

heat and should therefore be transported carefully. Documents such as proforma invoices and

commercial invoices are essential as they make the entire process of transportation to be more

efficient. Generally, the transportation route of oil from Italy would be through the

Mediterranean Sea, across the Atlantic Ocean to the chosen East Coast port such as Port

Everglades. From there the product would use road transport to the city of Oklahoma, its final

destination.

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References

Banias, G., Achillas, C., Vlachokostas, C., Moussiopoulos, N., & Stefanou, M. (2017).

Environmental impacts in the life cycle of olive oil: a literature review. Journal of the

Science of Food and Agriculture, 97(6), 1686-1697.

Herold, D. M., & Lee, K. H. (2017). The influence of the sustainability logic on carbon

disclosure in the global logistics industry: The case of DHL, FDX and

UPS. Sustainability, 9(4), 601.

Johnson, T. E., & Bade, D. (2010). Export/import procedures and documentation. Amacom.

Proietti, P. (2014). Olive handling, storage and transportation. The Extra-Virgin Olive Oil

Handbook, 107.