MOVEMENT OF PRODUCTProduct movement

MOVEMENT OF PRODUCT
Product movement is different with international, and the impact ripples throughout the supply chain. Shipping between countries involves more than shipping between states. Sourcing from Hong Kong to Chicago creates roughly an 8000-mile supply chain. Selling to a customer in Frankfurt. Germany is over a 4000 mile supply chain. Add additional sourcing origins and sales destination or have a global supply/sales network not involving the U.S. and the length and complexity of a company's supply chain becomes significant.
There are two transport options for U.S. companies engaged in international trade-ocean and air (excluding trade with Canada or Mexico). Ships, unlike trucks in domestic transport, do not move every day. Same with planes for cargo. This creates a surge effect with peaks and valleys, rather a daily stream of product movements. In-transit inventory becomes both a benefit and a problem with the longer distances.
Companies have to create flexibility to compensate for the surge. Forecast accuracy becomes even more important. Work plans must have contingencies built in; extra inventories may be needed at certain times, The ability to pull up supplier schedules must be there. Typhoons in the Pacific, winter storms in the North Atlantic or dock strikes can upset shipping schedules. Staggering shipping plans to use ocean carriers or air forwarders who provide a fast, reliable transit time. Using MLB service into the East or Southeast may be needed. At other times, slower transit options may be needed. At other timers, slower transit options may be needed-as opposed to carriers with longer transit times or all-water service options.
Multi-mode transport strategies can, where the product permits, buffer the surge effect by creating a pipeline with product moving at all times. Multi-mode also has use as a quarter evolves. For example, if sourcing from Asia to supply a Europe distribution or manufacturing operation, then a quarter could begin using all ocean transport. Then a shift to sea-air as the quarter moves. Finally shifting to air freight as the end of the quarter ends, yet also starting to ship via ocean to load the supply chain for the next quarter.
Product movement includes more than transportation. For example, add in different pallet or shipping carton specifications between shippers. These can slow down order preparation/shipping or receiving.
Also, many parties are involved with international transportation. Truckers who move containers or cargo to and from sea ports or airports, customs brokers, carriers, forwarders each have their own operational particulars and idiosyncrasies, which can hinder the efficient movement of shipments. Complexity from the involvement of multiple parties exists.
The other challenge with Supply Chain Management international logistics, and will be with the emerging emphasis on E-commerce is that customer orders sizes are reduced. This means smaller shipments to pick and ship, the impact of which ripples through the other key logistics issues.