Five (5) Basic Methods of moving Conventional Goods

A. Transportation
There are five (5) basic methods of moving conventional goods: truck, rail, water, air, and
pipeline. However, In this electronic age, there are three (3) other means of transportation that
should be noted. Small package deliveries have become a unique transportation method to get
fast, dependable delivery of small quantities, replacement parts, special deliveries, and other
items. Another unique delivery is the shipment of electrical energy over high-voltage
transmission lines. Lastly, the shipment of data over fiber-optic networks or wireless networks is
an essential part of sending information to accompany products.

 Truck: Privately Owned or

Third-Party Carriers -
Deliveries by truck have become
the primary mode of shipping
goods domestically. The
advantages include doorto-door
convenience, fast mode, and
good geographic coverage.
However, the increase in fuel
costs is causing businesses
to consider other modes of
transportation.  Rail: For
Selected Goods - Using rail
transport is a medium-cost, mediumspeed option, with limited
geographic coverage.
Since the latter period
of the nineteenth
century, railroads
have been a major
shipper, largely in
heavier freight

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 categories. Its main disadvantage, however, is that it lacks the
convenience of trucks. Only a few suppliers have a rail spur at
the side of their facility and almost no modern retail stores do.
Additionally, rail shipments usually require multiple loadings.

 Waterways - Shipments by barge on inland waterways and cargo ships on the oceans play
an important role in the transport of goods. Using waterways represents a slow-speed,
low-cost option but with obvious geographic limitations.
Heavyweight cargos are
practical to transport
by ship or barge. Another
driver of increased
shipping business is
the increase in offshore
outsourcing. As
companies extend their
supply chains into other
countries, there will be increased demand for shipping by sea.
 Air - Airfreight for small and expensive goods is becoming more popular. Air is a high-
cost, high-speed transportation mode and is offset with limited geographic coverage.
However, it is unlikely for heavy cargos to be shipped by air. Some examples of major
cargo air
carriers are
United
Parcel
Service, Inc.
(UPS) and
FedEx
Corporation
(FedEx).

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 Pipeline - oil is the principal commodity shipped by pipeline. Where appropriate,
pipelines are an economical, fast. and safe way to ship goods. However, these advantages
are offset by the limited geographic
coverage of
pipelines. Moreover,
pipelines are
primarily used for oil.
natural gas, and
chemicals.
Although there have
been proposals for
carrying alternative
goods, none have
reached a significant
development yet.
 Parcel - Private carriers like UPS and FOX have grown as carriers of lightweight parcels.
All of them stress the reliability and speed of their deliveries, along with wide
geographical coverage. Increased online
buying with direct-to-home deliveries
also increases the
importance of parcel deliveries.
These companies are also
expanding their roles as third-party
providers, such as handling returned goods
for repair.

 Transmission Lines - Electricity is an essential

part of the supply chain because it is
required to drive equipment
for service operations and move data around the

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 world. None of the conventional transportation modes can deliver electricity, this requires
specially constructed transmission lines.

 Fiber Optic Cable Networks - The world depends on the flow of information. Since the
development of the telegraph.
Information was transported in the
form of bits of electrical energy through copper
lines In the past decades, fiber optic cables, with
their larger carrying capacity and
lighter weight are rapidly replacing copper
lines. These specialized networks represent a
fast, low-cost transportation mode with good
geographical coverage to transmit information.
B. Materials Management
Logistics is concerned with moving goods, but it is even more concerned with moving the right
goods at the right time to the right place. As such, the logistics network must have some way
determine what is to be shipped in order to determine the correct packaging to prevent damage of
the goods in transit and the best mode of transportation to meet the need by dates economically.
A good information system is necessary to link transportation companies together.

C. Interim Storage
As products move from origin to destination, there will likely be a need for temporary storage.
This may be at docks where goods move from ship to train or truck. It could be at distribution
centers where goods undergo some transformations such as repackaging to make them ready for
the next destination. An integrated logistics system must accommodate these transfer points and
must be inspected to assure the quality of the goods being moved.

D. Exchange Points
The methods for loading and unloading goods from one mode to another have evolved from
manual to equipment assisted. Shipping containers have transformed the movement of goods on
ships. Goods are loaded into the container at the factory then loaded onto trucks for delivery to
the port where the containers are loaded intact onto ships. This process is reversed at the

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destination, this intermodal system has been refined over time and has been a key factor in
enabling companies to move to offshore outsourcing.
Moving goods through exchange points requires documentation of quantities and product
condition at the time of exchange. It often requires compliance with government agencies and
the accompanying paperwork. When the exchange is between countries, it involves more
paperwork and requires trained personnel either at the shipping or receiving company.

E. Traceability
Tracking technologies enable companies to track their shipments, almost on an hourly basis. This
is most critical for food shipments where proper handling is important. Food products have to be
stored in refrigerated conditions to preserve their quality.

F. Integration
Linking all of the logistics requirements into a total system is exhaustive for a single company to
handle, especially small companies with limited personnel. As a result, and in order to
concentrate on their core competencies, an increasing number of retail and manufacturing
companies are turning to third-party logistics providers to design and manage the logistics part of
their supply chain.

G. Outsourcing
One of the major trends in supply chains is the movement toward offshore outsourcing This
strategy has extended supply chains around the world. While this has made it possible to reduce
costs, it has increased lead times and complexity of supply chains. As the business environment
becomes more complex, It is Increasingly difficult for a company to be sufficiently competent in
all aspects of the business.
Offshore outsourcing requires more comprehensive decision making and has also moved the
transportation functions from a simple modal choice to a multimodal coordination challenge.