Competing in the global Marketplace
Availability of Space: At the time of liner service selection, clients prefer the company that can provide them desired space when required. Clients want that their liner service company must provide them enough space even at a short notice period. Most of the clients use a combination of these all factors at the time of selecting a ship, cargo or liner. The suppliers of north Atlantic region also use a mix of these aspects and the north Atlantic liner trade logistics companies seek to attract the clients by providing them proper value for their money. Future Prospects & Service Patterns of North Atlantic Liner Trade Logistics
The liner companies has developed up to a significant extent in recent years and there is an improvement in productivity of their service but the North Atlantic Liner trade logistics companies are improving their productivity by adding latest ships that are very fast and large in comparison to the older ships. Today the importance of liner service has increased and the suppliers of north Atlantic region and other are preferring liner services for transporting their material to the customer. Many liner companies are going for mergers and strategic alliances with other companies of liner shipping
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There are a number of service patterns used by the liner companies such as butterfly services, triangle services, convoy belt services, pendulum services, and others forms of end to end services. Globalization and continuously increasing number of multinational companies in the North Atlantic region is paving new avenues for the development of North Atlantic Liner trade logistics. Day by day, the companies are increasing the use of liner services for trade and logistics. Nowadays, globalization and international business has increased and there is an increase in American exporting to the north Atlantic region (Hill, 2005).
This has increased the shipping traffic in North Atlantic region and other parts of the world. With this, the ACL is seeking to increase the number and frequencies of its ships in order to reduce the time and cost of logistics. Globalization and increased export-import activities of material in bulk is quite beneficial for North Atlantic Liner trade logistics and it has a rich future. Logistical Factors Logistics refers to the management of transporting goods, information and other resources such as energy, people, etc. from one place to another location.
In other words, it involves planning, organizing, managing, executing and controlling the transport operations of freight (Craig, 2000). Logistics involves packaging, material handling, information integration, transportation, inventory and warehousing. Logistics plays an important role in domestic as well as international business. Transportation of small and light weight goods is much easier than the goods which are transported using liner services. The primary components of logistics are as follows: Facility Location: Logistics can be used more effectively if the location of facilities is fixed such as manufacturing plant and warehouse.
Along with this, future market potential, company’s future plans, political stability, competitive factors, etc. are also considered in logistics. Inventory Management: The primary objective of inventory management is to minimize the inventory cost. Proper inventory management is also helpful in logistic management. Order Processing: An efficient order processing by the company and the client carries significant implications for inventory levels and logistics. Transportation and Material Handling: Transportation and material handling are very important part of logistics management.
Use of new technologies in material handling and transportation improves the logistics efficiency. Shipping logistic is a form of transportation that covers a wide area of this world. International logistics requires a joint involvement of manufacturer, supplier, ocean carriers, freight forwarder, and customer. In other words, it is a series of transactions. The factors that are considered in liner trade logistics are as follows: Product Movement: The movement of product is different in domestic and international business. The cost of moving the product varies for product to product and medium to medium.
For example, moving the products through air transport is more expensive and air transport can not be used for all type of materials such as heavy quantity of coal, iron ore, chemicals, etc. and moving the goods through water transport is less expensive in comparison to air transport but highly perishable items can not be transported by this medium. The selection of any mode of transportation depends on the need of company. The company has to decide that is there any urgency of transporting the product or is it highly perishable that requires immediate transportation. Some companies use a mixture of different mediums of logistics.
Information Movement: The movement of information also varies from country to country. Different countries have separate requirements of documentation. It varies in the country, in which the company is exporting and in the country, from where it is importing. The flow of information in different countries also differs due to the use of different technologies. Nowadays, all the companies are using telephones, fax, emails, etc. for communication but in some cases it may happen that any of the countries or trading partner may not be using internet or electronic information transmission.
Along with this, the difference in languages and time zones also fluctuate the flow or movement of information. The factors such as accuracy, speed and completeness are important in the movement of information. It is an important factor in the field of logistics. Cost: Cost is a factor that matters everywhere. Except transportation, there are various costs involved in international logistics such as insurance, custom duties, brokerage, warehouse charges, etc. The fluctuation in exchange rates is directly proportional to the fluctuation of logistics cost. Any delay in transportation increases the cost of logistics.
Service: Services offered by the logistic provider companies is an important factor in the selection of a logistic company. Companies analyze the service level of logistic provider on the basis of past records, experiences and references. They are aware of the services provided by different logistic service provider companies. Time: Time is an important factor in transportation. Longer time in transportation directly affects the lead time, cycle time and inventory time. If the logistic company is not transporting the material on time, companies do not select such companies for transporting the material.
Delivery of products on time maintains a good relation between the manufacturer, supplier and client. Integration: A proper integration of all the logistic channels is very necessary for a faultless transportation of material. Integration between product and information is also very necessary. Any error in the integration process creates delay in transportation. As logistics is a process, a proper integration of all the parties is quite a must in international logistic management. In some cases, time difference, improper flow of information, money matters, etc. block the process of integration.
Global logistics need a proper integration of planning, managing, and controlling of transportation activities. Environmental Factors: Various environmental factors such as economic conditions, legal policies, and political environment are also very important in international logistics management. The countries that are not having political stability may create some problems in the process of exporting and importing in international logistic management. Economic conditions of a country may also affect the international logistic management. Legal policies of a country are also important in the process of international logistic management.
Different countries have different laws according to their constitution and the logistic companies have to follow those rules in order to operate in that particular country. In this manner, the above factors are very important in international logistics management. These all factors have their own importance and they can not be avoided completely. Conclusion Thus, from the above discussion it can be derived that the North Atlantic Liner trade logistics is playing an important role in the logistic industry. It is serving almost all the countries of North Atlantic region and many parts of the world.
The liner services have made a secure position in the shipping industry. Prior to the development of liner services, the shipping of the goods was not specialized but liner services have provided an ease of transportation to the suppliers. The North Atlantic Liner trade logistics have a secure future because nowadays export & import activities are increasing globally. Liner service companies are increasing the number and frequency of ships to reduce time and cost of shipping. In this manner, the future of North Atlantic Liner trade logistics is quite fruitful. References Brook, M. R. (2000).
Sea Change in Liner Shipping: Regulation and Managerial Decision-Making in a Global Industry. Oxford: Pergamon Craig, T. (2000, June). International Logistics: World Wide Shipping. Retrieved November 20, 2008, from http://www. ltdmgmt. com/mag/global600. htm Hill, C. W. L. (2005). International Business: Competing in the global Marketplace (5th Edition). New York: McGraw Hill Publishing Company. Notteboom, T. E. (2008). The Time Factor in Liner Shipping Services. Retrieved November 20, 2008, from http://www. palgrave-journals. com/mel/journal/v8/n1/full/9100148a. html Stopford, M. (1997). Maritime Economics. Routledge.