FACTORS INFLUENCING THE CHOICE OF TRANSPORT

FACTORS INFLUENCING THE CHOICE OF TRANSPORT

• Distance: Although the cost of haulage increases with distance, the cost of rail and shipping services does not increase in proportion to distance travelled. Thus it is more economical to use rail or shipping services over long distances, whilst road transport is faster and cheaper for short distances.
• Nature of the Goods: Perishable goods need quick delivery and minimum handling. Specially constructed trucks can be used to transport vegetables, fish and milk. In foreign trade, air transport can be used to transport perishable goods. Products like oil can be transported in oil tankers in foreign trade and by pipelines or oil trucks in home trade.
• Quantity: Bulky goods are normally transported by railway in home trade and by sea in foreign trade.
• Value of Goods: Expensive goods, which are small and light are normally transported by air. In home trade, it is not advisable to send expensive goods by rail. Road transport is more suitable for expensive goods since the problem of transshipment does not arise.
• Risk of damage: Fragile goods, which are easily breakable and need careful handling are normally sent by sea or air.
• Urgency: Goods, which are urgently needed, are sent by air.
• Convenience: The most convenient mode of transport is the one most available with the least formality. Road transport is considered to be the most convenient mode of transport, with its door-to-door delivery service.
• Cost: The consignor would normally choose the most economical mode of transport, unless the factor of urgency arises. Sea and rail would be most economical for bulk goods. Air and road would be most economical for urgency goods.

AIR TRANSPORT Advantages:

AIR TRANSPORT

Advantages:

• Aircrafts are now built larger to carry more goods.
• Mail, newspapers, medicine and perishable goods can be transported very quickly by air.
• Aircrafts are now available at short notice.
• Goods sent by sea need special packing for protection. But this is not so in the case of air.
• As the risks involved in transporting goods by air are less the insurance charges are low.
• The documents used in air transport are less complicated when compared with the documents used in sea transport.
• As there are no obstructions, aeroplanes can take the shortest route.

Disadvantages:

• Airfreight transport is very expensive because of high capital investment and maintenance costs.
• As aircrafts have limited cargo capacity, bulky goods cannot be sent.
• Usually airports are located outside the cities, so road transport has to be arranged to carry the goods to and from the airport. This results in higher costs and wastage of time.
• Bad weather may restrict flights.

SEA TRANSPORT: Advantages

SEA TRANSPORT:

Advantages:

• Cheap: Sea transport is cheap for carrying bulky and heavy goods over long distances. Moreover the fuel needed to run a ship is much less when compared with air transport.
• Bulk: Thousands of tones of goods can be delivered in a single journey. Oil tankers can deliver four hundred thousand tones of oil in a single journey.
• Flexibility: Ships go where business takes them. Hence they are flexible and exporters can transport goods easily.
• Facilities: Ships are specially built. Perishable goods can be transported in refrigerated vessels. There are ships for transporting raw materials. There are sophisticated loading and unloading facilities for ships.
• Short notice: Ships can be arranged at short notice to carry goods to any part of the world.
• Containerization: Goods are now packed in containers, sealed and then transported. Damages caused by rainwater and sunlight can be avoided. Theft of goods can also be avoided. The containers are loaded and unloaded with the help of cranes. So breakages can be minimized. Perishable goods can be transported in freezed containers.

Disadvantages:

• Slow Speed: Sea transport is not suitable for goods urgently needed because of its slow speed. So hence not all types of goods can be transported by sea.
• Documentation: Documents involved in transporting goods by sea are more in number and are very complex.
• Other costs: Expenses for insurance premium, packing costs, storage and port charges are very high and as a result increase the cost price of goods.

RAIL TRANSPORT: Advantages:

RAIL TRANSPORT:

Advantages:

• Cheap: Rail is the cheapest mode of land transport for long journeys, especially for bulky and heavy goods. If the goods are to be sent by road, then many lorries have to be hired and lorry drivers paid. But for a rail journey only the freight charges have to be paid.
• Speed: It provides faster services for goods and passengers especially over long distances. There are no traffic jams, to slow down the journey.
• Bulk commodities: Railways are very suitable for the transport of bulk commodities like coal, petroleum and iron and steel.
• Containerization: Goods are now packed in containers, sealed and then transported. Damages caused by rainwater and sunlight can be avoided. Theft of goods can also be avoided. The containers are loaded and unloaded with the help of cranes. So breakages can be minimized. Perishable goods can be transported in freezed containers.

Disadvantages:

• Transshipment: When goods are transported by rail, lorries have to be arranged to carry the goods to and from the railway station. So most of the customers prefer to use road transport for the whole journey.
• Delays: Railways follow a strict timetable, which leads to delays for customers needing immediate transport of goods.
• Short journeys: Railways are only suitable for carrying goods over long distances. They are not suitable for short journeys.
• Timetables: This is the biggest problem for railways as trains are not available at short notice. They follow strict timetables, which cause delays.
• Changing output: In recent years more emphasis has been shown on consumer goods, which are carried by road. With the decline of the coal industry and the steel industry, the need for the railways has also declined.
• High capital costs: Capital costs are heavy. Maintenance of tracks and railway rolling stock is also very expensive.

Recent Improvements in Rail freight Transport:

·         Many loss-making lines and stations have been closed.

• Diesel and electric locomotives, which give a faster service, are now being used.
• The signalling system and rail tracks have been improved.
• The freight transport is now operated by computer.
• The express parcel delivery by passenger train has been developed.

advantages and disadvantages of road transport

ROAD TRANSPORT

Advantages:

• Flexibility: Goods can be delivered right up to the customer’s doorstep. Even remote areas can be reached by road. In road transport, the direction can be changed very easily.
• Timetables: There is no specific timetable for a road journey. The transport can be arranged at any time and is even available at short notice.
• Economy: There is heavy competition in road transport resulting in efficiency and lower charges for customers. Employers have to meet the expenses for return journeys. So drivers can take loads on return journeys at lower rates.
• Motorways: The motorway system has developed and has linked industrial centers with consumers. Goods can now be delivered very fast.
• Vehicles: Vehicles have increased in size and efficiency. This allows more freight to be transported at one time.
• Suitability: Road transport is suitable for carrying small quantities of goods over short distances.
• Containerization: Goods are now packed in containers, sealed and then transported. Damages caused by rainwater and sunlight can be avoided. Theft of goods can also be avoided. The containers are loaded and unloaded with the help of cranes. So breakages can be minimized. Perishable goods can be transported in freezed containers.

Disadvantages:

• Bulk: It is not suitable to carry bulk goods by road as it incurs a great cost. Moreover the vehicles are small when compared with the quantity that the railways can carry.
• Congestion and delays: The heavy road congestion has become a problem resulting in delays in transporting goods to industrial centers. This problem does not arise in railways.
• Social costs: Private concerns are only worried about expenses such as driver’s wages, fuel, tax, etc. They do not take into account the expenses on pollution, maintaining the road system, signaling system, accidents, etc. These costs are met by the society and are called social costs. These costs are very high.
• Slow traveling time: A road journey will take more time especially for long distances when compared with railways. Road journeys could also be slowed down because of traffic jams.