1- Transportation in a supply chain refers to the movement of things from one location to another, starting at the beginning with resources moving to the warehouse and ending with the end-user. Finally, the order is delivered to the customer’s door. Warehouse managers should think about transportation as part of their supply chains because it is so important. in a scenario where transportation may account for up to 60% of general operating costs, a substantial portion of a company’s supply chain expenditures, this is the only way to cut total costs (Mohamed, 2019). These choices include whether to outsource logistics, which transportation chain to utilize from point of production to point of consumption, including the mode for each leg of the chain, and whether to consolidate and deconsolidate shipments. time and scheduling concerns, as well as the path across transportation networks Freight transportation and logistics are also studied on a national and worldwide scale from a macro perspective.
When a corporation becomes too large, its unit costs may begin to rise. This is referred to as a “diseconomy of scale,” and it is a significant disadvantage that new businesses must address. Diseconomies of scale can be caused by a variety of factors, including a lack of communication (Khoury, 2019). Ineffective communication is one of the leading causes of diseconomies of scale, making it more difficult to manage a large workforce as your company grows. Control loss – As a firm grows, supervising the productivity and quality of thousands of individuals becomes more difficult, resulting in inefficient production processes. When more than one person works on the same function or task, it is called duplication of effort. Employee dissatisfaction – As businesses develop, employees are more likely to feel separated and alienated, resulting in lower production and waste. Furthermore, internal economies of scale may not be as beneficial to consumers as they appear. To begin with, economies of scale may not always imply lower prices, as dominant businesses may form a monopoly and enforce higher prices. (2019, Khoury) It’s also crucial to remember that mass production can have serious environmental consequences, ranging from pollution to e-waste.
Khoury, P. S., & Singh, S. (2019). Building supply chain risk resilience: Role of big data analytics in supply chain disruption mitigation. Benchmarking, 26(7), 2318-2342. doi:http://dx.doi.org/10.1108/BIJ-10-2018-0346
Mohamed, D. S. (2019). Does supply chain analytics enhance supply chain innovation and robustness capability? Organizacija, 52(2), 95-106. doi: http://dx.doi.org/10.2478/orga-2019-0007
2-We may identify the following roles by systematizing all areas of logistics that need to be created for the rational management of production resources: Design and management of warehouses This function of logistics in supply chain management encompasses numerous duties at once, beginning with the design of storage facilities and finishing with the implementation of different automation solutions (for example, machines meant for carrying items within warehouses)—package construction. Packaging, tracking, and accounting are all duties that allow for complete control of products on their path to the customer/distributor (Nitya & Singh, 2019). Product transportation. This involves working with freight carriers and cars in the company’s fleet to arrange their routes, calculate fuel expenses, and so on, and taking care of customs. When an organization prepares overseas delivery of products, it is critical that the commodities completely comply with customs standards and carry all relevant documents during shipping—working with intermediaries. Intermediaries in logistics are any third-party, non-company resources that are actively involved in supply chain implementation. Finding intermediates with the best quality-to-cost ratios and creating long-term, dependable relationships with them are also on the list of duties for effective logistics management. Working with written-off and returned products There is also “reverse logistics,” which specifies the norms and routes for carrying produced/discarded products, as well as methods of disposal (Nitya & Singh, 2019).
Transportation in a supply chain refers to the transport of items from one point to another, which begins at the beginning of the supply chain with resources making their way to the warehouse and continues to the end-user. Finally, the customer’s order is delivered at the door. Because transportation is so essential, warehouse managers should consider it inside their supply chains. Finally, this is the only method to reduce overall expenses in a scenario where transportation may account for up to 60% of general operating costs, a significant amount of a company’s supply chain expenditures (Mohamed, 2019).
When a company grows too big, its unit expenses may start to climb. This is known as a diseconomy of scale, and it is a significant disadvantage that rising enterprises must consider. Diseconomies of scale can result from various sources, including Poor communication (Khoury, 2019). One of the biggest causes of diseconomies of scale is ineffective communication, which makes it more challenging to manage a vast staff as your firm expands. Control loss – As a company grows, it becomes more challenging to supervise the productivity and quality of thousands of people, resulting in inefficient production processes. Duplication of effort – Duplication of effort occurs when more than one person works on the same function or activity. Weak morale — As firms grow, employees are more likely to feel isolated and alienated, contributing to decreased productivity and waste. External resistance — Behavior that might have gone unpunished in a smaller organization is more likely to be perceived as a danger as a company grows, resulting in public and government resistance (Khoury, 2019).
Furthermore, the benefits of internal economies of scale for consumers may be less significant than they look. To begin with, economies of scale may not necessarily result in reduced pricing since dominating enterprises may create a monopoly and impose higher pricing (Khoury, 2019). It is also important to realize that the environmental effects of mass production, from pollution to e-waste, may be severe.
References
Nitya, P. S., & Singh, S. (2019). Building supply chain risk resilience: Role of big data analytics in supply chain disruption mitigation. Benchmarking, 26(7), 2318-2342. doi:http://dx.doi.org/10.1108/BIJ-10-2018-0346
Mohamed, D. S. (2019). Does supply chain analytics enhance supply chain innovation and robustness capability? Organizacija, 52(2), 95-106. doi:http://dx.doi.org/10.2478/orga-2019-0007
Khoury, B. J. (2019). Logistics data analytics alongside voucher programme phases. Journal of Humanitarian Logistics and Supply Chain Management, 9(3), 332-351. doi:http://dx.doi.org/10.1108/JHLSCM-06-2018-0050
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