Question

Assume that you are the supply chain manager for a producer of expensive, high-tech computer components. Identify the most suitable method(s) of transporting your product in terms of cost, transit time, reliability, capability, accessibility, and traceability. What level of distribution intensity should be used (intensive, selective, or exclusive) and why? Now, assume you are the supply chain manager for a producer of milk. How does this change your choice of transportation and distribution intensity?

Answer 1

For a high-tech computer, I think the most suitable method would be by truck or rail. I think those two methods would provide the customers with high reliability, quick transit time, and high traceability. High reliability is important because the customer wants to know that their expensive, high-tech computer components are going to be well taken care of and handled with care. Quick transit time is important because you never know if they need that part as soon as possible. The customer could be replacing a computer component or building a new one. Quick transit makes any customer happy. Finally, I think high traceability is important because customers like to know how far away their products are and when they should expect it to arrive. They may like to track their products because they want to make sure someone is at their house to bring the packages in. Obviously, the cost will differ with different methods of transportation.

In transportation of milk, the most important factor to consider is that milk is an extremely perishable commodity and any choice must take this factor into consideration. Regarding cost, milk can be transported using truck rather than air transport since milk is not a very expensive commodity, a consideration that also comes to play in respect to transit time. Truck is also the most reliable means of transport, which also takes perishability of the commodity into consideration. In terms of capability, all the other means of transport are either time-consuming or very expensive, leaving truck as the best choice, which is also the most accessible method. Air can be used for its traceability, but it is too expensive for transporting milk, leaving truck as the best method