Transportation and Distribution Systems (Research Paper Sample)

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Introduction
For a successful supply chain management, transportation is an essential element. Most of the companies in Australia use different types of distribution channels to enter the market with their products. Many different types of methods exist, but they have changed over the years because of the development of the internet and global sales. A company has to use one or more of the available distribution channels to get its products to the market for the consumers to use. The usual and traditional distribution channel moves from the supplier, manufacturer, distributor, the wholesaler and finally the retailer before reaching the consumers (Burrows 2012).
There are two types of distribution channels that include direct and indirect distribution channels. An indirect distribution channel is majorly used by companies who do not sell their products directly to the consumers. Most of the suppliers and the manufacturers use indirect distribution channels because they do exist early in the supply chains. But the direct distribution channels have become the most common because of the internet. In direct distribution channel, the company sales its products directly to the consumers, owing to the increased internet use by both the manufacturers and the consumers. Most of the companies prefer the use of direct distribution channels to cut down on the cost of using middlemen. When the direct marketers and the retailers mail seasonal catalogs, the delivery timing substantially affects the entire supply chain. There will be the need to hire customer service representatives, maximize the use of inventories to ensure the merchandise is available in the warehouses. Also the provision of employees who can fill and package orders (Papke, 2014).
To enable the product reach the market, a company has a choice of five different modes of transportation to use in the distribution channel. These include the use of the Waterways, the Road, Air, Rail, and Pipelines. In Australia the greatest volume of the freight is shipped by the railway, this is followed by the use of the highways through trucking, pipelines, and the waterways. By far a small volume is distributed through the air. The cheapest modes of transportation in Australia are the pipeline and waterways. Air is the fastest mode of distribution with both water and pipeline being the slowest modes. The use of trucks is much faster that the use of railway when it comes for short distance distribution. However, the presence of different shipping requirements and the all-purpose availability of different modes of transportation as the products move between regions. These include both in Australia and between Australia and other countries all around the world, various modes of transportation are more often combined. This method is commonly referred as intermodal transportation (Linstone & Turoff 2011).
Transportation and Distribution Systems
Standing Committee on Transport and Infrastructure (2012) stated that transportation is essential in a successful supply chain management. Given that the cost of transportation of goods can be as much as 20% of the total costs of productions of the same goods. The companies that are involved in the distribution of retail items for instance catalog sales can attract even higher transportation expenses. The cost of transportation will depend on where the company is located in the respective suppliers, distribution centers, warehouses and the customers. The levels of customer services can speed up the frequency of deliveries required by the company’s customers (sell, 2014).
The mode of transportation and the cost of the transportation will come in handy for determining the right kind of distribution channels to be used. The level of inventory within a company’s supply chain is affected by the mode of transportation to be used and how close it is to the physical facilities of the enterprise. The mode of transportation chosen by the company can determine the type of material handling, the packaging of the goods, loading, and the ordering processing systems to be used.
Railways
In Australia, railways are predominantly useful for the transportation of low-value, high-density, bulk products, for example, raw materials over long distances. the major distribution centers such as Sydney, Brisbane, Melbourne, Perth and Adelaide, which have an extensive railway transport system. Such products in most cases require little categorization, sorting, and classification. Of the total yearly rail freight tonnage, a little more than half of the products being transported comprise minerals, coal as well as ores. As a matter of fact, 90 percent of all coal transport is distributed by train. In general terms, railways have not been economical for distribution of small loads over short distances since there will be a high cost in terminal handling and the general inflexibility of railway lines (Deborah &Patrick 2013). Trains operate on less flexible schedules as compared to trucks, and they typically cannot travel directly from one plant or business location to another as trucks do. Trains operate from one rail yard to the next. Rail transportation is also ordinarily much slower as compared to the use of trucks, since the shipments spend quite a lot of time being put together as trains at the terminals (Piecyk & McKinnon 2010).
In Australia, the use of railroads has made several improvements to help triumph over some of these disadvantages and compete effectively with trucking for the smaller loads. An intermodal rail service pulls truck trailers or containers on the railroad that features a well-like lower section in which the trailer rides. The use of trains combines both low-cost, long-distance travel of the trains with the flexible delivery as well as pickup capabilities the trucks. Double-stacking on containers is also being used in rail transport where one container is being kept on top of another on a railcar. These can go up to 40% cheaper than the long-haul tracking. There is a recent innovation of the road trailer, which is a truck trailer having steel wheels for use on the rail and rubber tires that can be used on the road. These kinds of trailers have the ability to change from the highways to the rails and back allowing a more scheduled and faster delivery of small loads (Betty & Kildow2011).
Trucking
Trucking is the most used mode of freight transportation in Australia. The trucks provide a more flexible point to point delivery service that ensures smaller loads are distributed over short distances but in a wide dispersed geographical area. The trucking system has been very extensive with thousands of different firms in Australia and the services being provided typically fast, more reliable, less prone to damage than the respective shipping by use of the rail. In spite of this, the ability of the trucking system to handle small loads efficiently is quite an advantage. But then the inability to carry large loads at an affordable price is one of the trucking's most serious disadvantages. Besides, the trucks also lose their cost advantage over railway transportation over long distances. The terminal handling and management costs are proportionally less than the total transport charges and the general labor costs that are proportionally more (Finisterra et al. 2009).
Most of the companies have adopted an on-demand delivery system making the truck carriers improve their performance. Meaning that, the picking up and delivering orders in totality, free from damage and on time. With the right kind of paperwork at a cheaper cost is being looked at as a critical part of the supply chain. The process has to run swiftly from the suppliers to their given processors or customers. Successful and effective relationship between the suppliers and their given customers or the purchasers is developed. This can be largely disrupted by a carrier system that is not unable to meet the tight delivery schedules and one that damages loads on transit.
As a result, many of the giant Australian companies have reduced the number of truck haulers to a selected a few, or may resort to single-sourcing of their transportation needs. Single sourcing has also become a factor in railway transportation, but it is not by the designs from the shippers perspectives. The railways have been consolidating through mergers, leaving many of the shippers with only a single source leaving some of the locations in Australia in a non-competitive situation. With this, many of the shippers have ended up seeking for alternatives with the truck carriers. Such conditions will be right if the trend toward smaller and more frequent deliveries with fewer inventories continues (Sell 2014).
Airfreight
In the modern years, there has been an abundance of airfreight carriers that relatively small amount of goods. However, the majority of his types of air cargos travel on passenger flights. Air transport is one of the less utilized shipping modes but with time it is becoming fast growing. In the recent years, domestic and internal airfreight from Australia has been growing by close to 5% while the total international airfreight has been increasing by over 8%. The main types of products being shipped by air are mainly inclined to be lightweight or rather small for example different electronic components, perishable products, medical supplies and other emergency items requiring quick delivery outweighs costs. None the less, chartered aircraft are from time to time used for large all freight shipments. For instance, livestock is at times transported by chartered aircrafts as opposed to the use of ships since short flights of less than a day are less harmful to the animals. But the flights are quite faster than the use of transoceanic ships that c...