Question

1. Describe the implications of the threat of transportation disruptions, hazards, and risks as they apply to transportation and explain why they are important from financial and service standpoints?

Answer 1

transportation disruption can be seen as any unplanned or unanticipated events which can have some kind of interruption in the free flow and movement of the goods and material through the supply chain. These kinds of disruptions can cause the companies and organizations to be exposed to the financial and operations risks. A transportation risk can be seen as a future freight risk which can result in some kind of failures or risks or misfortune.

From the context of financial and service point of view, these sort of disruptions can occur frequently and can incur huge costs. A lot of extra work and delays have resulted from disruptions. Productivity is really hampered during the recovery phase which involves expenses and can require the premium freight services.

These kinds of disruption also have a negative impact on stock prices, will result in lower operating performance and increase the inventory levels and there will be a decline in assets turnover.