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Supply Chain
Selecting transportation modes for china imports.
Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers. Air freight was faster and more reliable, but ocean shipping was much cheaper. He decided to evaluate the shipping decision for two very different product categories—consumer electronics, such as smartphones, and decorative hardware, such as door handles and hinges.
China Imports provided a variety of products to its customers from a warehouse near the port of Long Beach, California. The company incurred a holding cost of 25 percent on all inventory held and aimed to provide a 98 percent cycle service level on its products. The high level of service aligned with the high quality of products that the company imported.
1. Transportation Options from China
Air freight and ocean shipping were the two options available to move product from China to the United States. Air freight charged $10 per kilogram shipped and required a minimum shipment of 50 kg. Besides being fast, air freight was also quite reliable. The average lead time on air freight was one week, with a standard deviation of lead time of 0.2 weeks. Ocean shipping was much cheaper and cost $1,200 per 20-foot container. Given that each container could hold up to 15,000 kg, the shipping cost per kilo by ocean was more than a hundred times cheaper than air freight. Ocean shipping, however, took longer and was less reliable. The average lead time using ocean shipping was nine weeks, with a standard deviation of three weeks.
2. Product Characteristics
Weekly demand for smartphones averaged 1,000 and had a standard deviation of 400. Each smartphone cost $300 and weighed 0.1 kg. The typical life cycle for a smartphone was about one year; it was critical to not lose demand early in the life cycle because of a lack of product availability. Weekly demand for decorative hardware averaged 5,000, with a standard deviation of 1,000. Each unit of decorative hardware cost $20 and weighed 1 kg. Decorative hardware tended to have a long life cycle— the company was still selling door handles and hinges that were introduced more than a decade earlier.
Source: Chopra Sunil, Meindl Peter (2014), Supply Chain Management: Strategy, Planning, and Operation , Pearson; 6th edition.
15 Jun 2021
14 Jun 2021
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The effect of distance on cargo flows: a case study of Chinese imports and their hinterland destinations
- Original Article
- Published: 29 May 2017
- Volume 20 , pages 456–475, ( 2018 )
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- Likun Wang 1 ,
- Anne Goodchild 2 &
- Yong Wang 3
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With the rapid development of ports in China, competition for cargo is growing. The ability of a port to attract hinterland traffic is affected by many factors, including distance to the hinterland destinations. This paper studies the effects of distance on import cargo flows from a port to its hinterland. Two major findings are reported. Through a Spatial Concentration Analysis , this study shows that cargo imported through ports with relatively low throughput is primarily delivered to local areas, with the proportion of cargo delivered to local areas from larger ports being much smaller. The present study also shows (according to a gravity model, the Gompertz function and several other methods) that cargo flows from a large port to its hinterland increase with distance below a certain threshold, while cargo flows approach a stable state once they exceed this threshold. These results can be used to inform port managers and policy makers regarding the hinterland markets for ports of different sizes.
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Acknowledgements
The authors wish thank the editor and anonymous referees for their valuable suggestions, which have helped improve this paper considerably. This study was sponsored by the Social Science Foundation, by the Ministry of Education of China (Grant No. 12YJC630205), through the Shanghai Pujiang Program (Grant No. 15PJC060), and by the Shanghai Maritime University Foundation (Grant No. 20120079).
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College of Transport and Communications, Shanghai Maritime University, Shanghai, 201306, People’s Republic of China
Department of Civil and Environmental Engineering, University of Washington, 121E More Hall, Seattle, WA, 98195, USA
Anne Goodchild
School of Economics and Management, Chongqing Jiaotong University, Chongqing, 400074, People’s Republic of China
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Correspondence to Likun Wang .
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Wang, L., Goodchild, A. & Wang, Y. The effect of distance on cargo flows: a case study of Chinese imports and their hinterland destinations. Marit Econ Logist 20 , 456–475 (2018). https://doi.org/10.1057/s41278-017-0079-3
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Published : 29 May 2017
Issue Date : September 2018
DOI : https://doi.org/10.1057/s41278-017-0079-3
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The high level of service aligned with the high quality of products that the company imported. 1. Transportation Options from China. Air freight and ocean shipping were the two options available to move product from China to the United States. Air freight charged $10 per kilogram shipped and required a minimum shipment of 50 kg.
Question: Case Study Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20 -foot containers.
Therefore, this study uses SEA as a case study to analyse shippers' choice behaviour on choosing transport mode through an economic benefit analysis with three platitude factors (i.e. distance, time, cost) and an increasingly important environmental factor (i.e. CO2 emission). The rest of this paper is structured as follows.
1. CASE STUDY Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was look times cheaper than air freight. Ocean shipping, however, ing to design a framework to select transportation modes took longer and was less reliable. The average lead time for various products imported from China to the United ...
Presented byS NANDHINIIV Year - IT
China Imports Case Study Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers. Air freight was faster and more reliable, but ocean ...
6. Case Study. Take China's multimodal transport network with 10 cities as an example, it involves 10 cities, the origination is Chengdu and the destination is Shanghai, as shown in Table 2.Since there are many inland cities in this multimodal transport network and the water transport is poor, we considered three transport modes: road, railway, and air in this case.
Distance decay is a well-established phenomenon of passenger transportation (Fotheringham 1981; Luoma et al. 1993). The concept has also been explored in reference to freight transportation, in which hinterland shippers or consignees typically select the closest ports to import/export cargo. Such selection has been attributed to cost minimization.
(Ans 3): Some other transportation modes in logistics shipping & supply chain enhancement can be via railways or road, with advance countries started to apply multi modal transportation system. For component like smartphones or any electronic gadgets we can adopt railways as a special way to
China's imports and exports . ... select railway mode, with a mode shift . ... Intermodal Transportation: A Case Study of Vientiane - Boten Railway. 235. Florian, F. (2019).
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China Imports Case Study Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers. Air freight was faster and more reliable, but ocean ...
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Question: CASE STUDY Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was look- ing to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers.
This results in an annual cost of $13,200 for ocean shipping to import decorative hardware. 3. In addition to cost, other factors should be considered when selecting a transportation mode for products imported from China to the United States. These include lead time, reliability, and service level.
China Imports Case Study Selecting Transportation Modes for China Imports. Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers.
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CASE STUDY. Selecting Transportation Modes for China Imports. Jackie Chen, vice president of China Imports, was looking to design a framework to select transportation modes for various products imported from China to the United States. His basic options were to either use air freight or ocean shipping in 20-foot containers.
Transcribed image text: 432 Chapter 14. Transportation in a Supply Chain CASE STUDY Selecting Transportation Modes for China Imports Jackie Chen, vice president of China Imports, was look- times cheaper than air freight. Ocean shipping, however, ing to design a framework to select transportation modes took longer and was less reliable.