1. THE IMPACT OF GLOBAL LOGISTICS3

2. The global logistics management process
Environmental analysis
Planning
Structure
Plan implementation and
Controlling the logistics program

3. Cost-service trade off analysis
Order completeness
Shipping accuracy and
Shipment condition

4. Guidelines for developing a global logistics strategy
Logistics planning should be integrated into the firm’s strategic planning process
Logistics departments must be guided by a clear vision and must measure output regularly
Import-export management should try to ensure integrated management of all elements of the logistics supply chain from origin to destination
Opportunities to integrate domestic and international operations should be pursued to leverage total company volumes with globally oriented carriers

5. The global logistics environment
Controllable elements
Uncontrollable elements

6. Uncontrollable elements
Political and legal systems of foreign markets
Economic conditions
Degree of competition in each market
Level of distribution technology available or accessible
Geographic structure of the foreign market
Social and cultural norms of various target markets

7. Controllable elements
Customer service
International Inventory issues
International Packaging issues
Transportation
Warehousing and storage
Other activities like global sourcing of materials

8. Issues related to global logistics
International customer service issues
International inventory issues
International packaging issues
International transportation issues
International warehousing and storage issues

9. 1. International customer service issues
Consumes longer time
Requires different types of transport carriers,
Multiple transfers and handling
Crossing of many international borders
Time in transit vary from shipment to shipment

10. 2. International inventory issues
International business have 50% or more of their assets in inventory
Inventory levels differ depending on the length of the transit
Includes unique factors such as currency exchange rates, greater distances and custom duties
In case of high inflation, large inventories provide inflation hedge

11. 3. International packaging issues
Handling of products
Climate
Potential for pilferage
Communication and language differences
Freight rates
Customs duties
Customer’s requirements

12. Containers - advantages
Reduced cost due to loss or damage
Increased use of automated or mechanized material handling equipments
Lower warehousing and transportation costs
Available in variety of sizes
Serve as temporary storage facilities at ports and terminals

13. Containers- disadvantages
Delay caused in in-bound and out-bound cargo
Large capital expenditures are required to initiate a container

14. 4. International transportation issues
Infrastructure
Availability of modes
Choice of modes among the given alternatives

15. a. Ocean or Sea transport
Liner service-regular scheduled passage on established routes
Bulk service-contractual services for individual voyages
Tramp service- irregular routes and scheduled only on demand
Based on the type of cargo carried
Conventional cargo vessels-oversized and unusual cargo
Container ships-standardised containers
Roll-on roll-off vessels-ocean going ferries

16. Shipping documents used in ocean shipping
The standard shipping note(SSN)- what is to happen to the goods on arrival at the foreign port
The bill of lading-shipping company’s receipt for the goods loaded

17. b. Air transport or Air freight- advantages
Useful for transportation of perishable products, high value, high density products
Less stock holding in loading terminals
Speedier settlement of invoices
Eliminates excess need of intermodal transportation
Facilitates JIT
Convenience and ease of administration

18. c. Rail and road transport
‘International consignment note’

19. Choice of transport method
Transit time
Predictability
Cost of transportation
Non economic factors- govt pressure-UNCTAD- United Nations Conference for Trade and Development

20. 5. International warehousing and storage issues
Storage facilities- bonded warehouse
Free ports- wider area at sea port and
free zones- near air ports

21. Queries?????