Example Of Freight Transportation And Distribution Of Goods Research Paper
Freight transportation is an important component in any economy. Freight transportation spurs the production of goods in a country because it provides the inlet of raw materials (Crainic and Kim, 2006). Moreover, it supports trade and consumption of goods by enabling timely availability and efficient movement of finished goods. Transportation is an important element, and it is usually factored in the final cost of finished products. Freight transportation has been instrumental in opening new markets and thus expanding trade. Moreover, freight transportation has enabled companies to access raw materials that were only available in far-flung areas (Zlatoper and Austrian, 1989). This paper seeks to explore the economic value of freight transportation and distribution of raw materials and finished goods in the global economy.
The huge distances that separate producers and consumers are responsible for the huge demand in freight transportation. Freight transportation helps producers to move raw materials from the sources to the factories or production sites as well as intermediate goods which are useful in the production of goods. Once the production of goods is complete, the producer has to distribute them to final consumers. Despite the fact that consumers may be located in far places, they are able to access goods thanks to freight transportation. Freight transportation is crucial in growing the manufacturing sector. Producers are able to carry on with manufacturing activities because of accessibility of raw materials. These producers may be small manufacturing entities or big corporations. Manufacturing entities that require raw materials that are absent in their locations are forced to import them from countries that produce them (Rondinelli and Berry, 2000). The imported raw materials reach their destination via freight transportation. For example, an entity involved in car assembly will source raw materials from countries that make them. These are transported in containers on ships. The car assembly parts are crucial in sustaining the car assembling company and ensuring that it continues to produce for the local and international products. This ensures that people continue holding jobs at the company and income to support their lives and those of their families. The car assembly entity also remits tax to the government which is necessary to support government programs. Essentially, freight transportation is the precursor to the creation of jobs and earning and remittance of tax from companies by the government.
Additionally, freight transportation is crucial in spurring entrepreneurship (Crainic, 2003). The car assembling entity that imports car parts for use in producing of automobiles is purely an entrepreneurial venture. The inability to access the car parts would have rendered the company practically impossible to operate. The effects of this are blowing up of entrepreneurial dreams and jobs unavailability. The simple fact of bringing in raw materials through freight transportation fuels entrepreneurship. Moreover, freight transportation is important in distributing finished goods to markets. The common phenomenon is that, there is no country that can produce all the goods it needs. Some countries are leaders in the production of agricultural products while others lead in the production of industrial goods. Freight transportation will be extremely important in the transportation of Brazilian coffee to all places where it is demanded. Likewise, freight transportation ensures that Japanese automobiles reach markets in Asia and Europe. Therefore, freight transportation is instrumental in fueling global trade. Producers are able to able to penetrate markets regardless of the distances involved (Han & Fang, 2000). Countries that are experiencing a glut in the local consumption of particular freely use freight transportation to export the surplus to other countries or regions in the world (Han & Fang, 2000). The freight transportation is responsible for hauling millions of tonnes of finished goods to markets every year. The exportation of goods earns countries foreign exchange that is essential in executing many programs in these countries.
Moreover, carriers are central to freight transportation, and their absence will essentially cripple the transportation sector. Carriers include ocean shipping lines, seaports, railways, postal services, and trucking companies (Hesse and Rodrique, 2004). Oceans shipping lines are crucial for import and export business over seas and ports where railways enable transportation of goods and people in countries and over regions. Postal services are crucial in the movement of mail, documents, and money. Railway lines enable movement of manufactured goods from manufacturing zones to the hinterland parts of a country for consumption. The carriers create many jobs and breathe life into the economy. Therefore, carriers in freight transportation generate many employment opportunities and contribute immensely to the growth of economies of countries.
Transport infrastructure like highways, roads, rail facilities, seaports, and internal navigation enhance freight transportation. These infrastructures are mostly provided by governments and they open up hinterlands for the expansion of business and industry (McGinnis, 1990). The cost involved in availing these infrastructures can be humongous, but the benefits that accrue from their use in transportation of freight far outweigh these costs. The infrastructures enable transportation of high-value products like minerals and petroleum to markets to generate revenue for companies and governments. Moreover, they enable the transportation of important products such as sugar, industrial products, household commodities, furniture, and raw materials to final consumers.
Container-related transportation also falls under the freight transportation industry. Container-related transportation has been on upward surge owing to constant opening up of new markets and hence the increase in export and import business (Ren-fa, 2006). Containerized transportation provides significant support to the movement of goods internationally. Freight transportation fuels the container making industries. These industries create employment opportunities for people and improve their income generation capacity. Moreover, the growth in containerized transportation ultimately leads to the growth of the iron and steel industry. Iron and steel are used to make high-quality containers that can be used for carrying raw materials and finished goods over seas up to their destination. In addition, containerized transportation necessitates the building of container terminals and ports. These are built or undergo modification to be able to accommodate ships carrying containers and for loading and unloading of container operations. Moreover, terminal equipment for handling containers is constantly enhanced to lower container handling time and costs, and to improve overall productivity. Moreover, ship building firms have developed, and they play a crucial role in making ships necessary for carrying containers to their destinations. Containerized transportation is central to the development of the shipbuilding sector, growth and expansion of ports, and growth in iron and steel industry (Ren-fa, 2006). The underlying thing is that, freight transportation has an immense trickle down effects. The necessity to transport finished goods to global markets and raw materials to manufacturing plants has led to development many industries.
Freight transportation enables distribution of finished goods to customers for eventual consumption. Consumers are able to access goods from all parts of the world and hence meet their needs. Essentially, consumption fuels the retail industry by ensuring that goods of all types and from all parts of the world reach local stores (Zlatoper and Austrian, 1989). For these goods to reach the stores, they have to be transported from manufacturing plants. Freight transportation enables even distribution of goods in an economy hence prevents the occurrence of plastic scarcity of goods. A balanced distribution of goods can only be achieved through efficient freight transportation. A transportation system that is well developed is crucial in the development of the economy because it enables goods reach the markets where they have a high demand.
Additionally, freight transportation is important for opening up hinterlands and making it possible to exploit opportunities that are found there. This is because it necessitates the building of roads, railways, and waterways. The economic opportunities present in the hinterlands are exposed by infrastructural development, and this invites investors to these areas to come and exploit opportunities in agriculture, mining, and services sector (Hesse and Rodrigue, 2004). The growth in these investments is also hinged on the transportation sector. All the goods produced can only reach markets through efficient transportation and distribution networks.
Freight transportation is a very important component in any economy. So many industries and sectors emerge from freight transportation. Moreover, freight transportation is the engine that pumps economies. Trading of goods is only possible through their transportation from their sources to markets and shops where consumers can access them conveniently. Apart from moving goods, freight transportation generates many employment opportunities for people enabling them to earn income. Some of the sectors that have grown due freight transportation include the shipbuilding industry, iron, and steel sector, the building of container channel and ports. Moreover, freight transportation leads to the development of physical infrastructures like roads and railways for the singular function of transporting raw materials, people, and finished goods.
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Hesse, M., & Rodrigue, J. P. (2004). The transport geography of logistics and freight distribution. Journal of transport geography, 12(3), 171-184.
McGinnis, M. A. (1990). The relative importance of cost and service in freight transportation choice: before and after deregulation. Transportation Journal, 12-19.
Ren-fa, Y. A. N. G. (2006). Analysis of present situation and trend of oversea inland navigation containerized transportation [J]. World Shipping, 3, 026.
Rondinelli, D., & Berry, M. (2000). Multimodal transportation, logistics, and the environment: managing interactions in a global economy. European Management Journal, 18(4), 398-410.
Zlatoper, T. J., & Austrian, Z. (1989). Freight transportation demand: a survey of recent econometric studies. Transportation, 16(1), 27-46.
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