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Transport logistics is the single most important component of the supply chain in that it contributes to customer satisfaction. While every component relies on the next, the supply chain managers greatest asset is a transport network that runs flawlessly with the following charactaristics being the most important.

consistency of performance
reliability and dependability
Coverage (national, International and door to door)
Flexibility in both product differentiation and ability to act in a crisis
Loss control
Damage control

An effective transport channel, each channel member has its own cost centre as well as responsibility channel. As soon as the different transport channels attempt to roll expenses into a different channel, immediately the channel member is under more pressure and the likelihood of errors is compounded. The adage of “Do what you do best” comes into play. For a distributor to try to save costs by cutting out an intermediary can have disastrous results resulting in unhappy customers and a negative perception of the company and its brands.

By working together, the members of the supply chain are all looked upon as customers from whom a certain level of service is required. Any member of the supply chain in a segmented approach can be replaced fairly easily if the demands are not met, placing each member under pressure to perform consistently. The key to an effectively operated transport logistics system is information management.

Information systems and exchange such as Electronic Data Interchange (EDI)
Access to planning systems
Strategic alliances and joint ventures
The use of common equipment (trucks and cranes)
Co-ownership of such equipment
Outsourcing or using whatever activity or union (strategic partnership or joint
venture) that will drive costs down and increase customer service.

When all partners in the transport logistics network co-operate in a synergistic manner, processes are streamlined, products reach the particular parts of the supply chain on time, at the right time. These systems are designed to facilitate,

Order processing
Transport planning
Production planning
Inventory control
Account management

Transport is the largest cost contributor in the supply chain and the effective management of all transport services is vitally important to a logistics and supply chain manager. In a cost sensitive business environment, controlling and managing transport costs are the key to success.
transportation costs.