STUDENTS' CORNER - 237

Transport ( Logistics)

Now, let us spend some time on Transport as a part of Logistics. In a very comprehensive subject like Logistics, Transport occupies a prominent place. Economists talk of Logistics cost of a country and here also, that is , in India, we know all the sustained efforts of the Centre are singularly focused on reducing the logistics cost comparable to that of Developed countries like US and UK.

All ministers say the logistics cost of the country is very high compared with developed countries.  While logistics cost of the developed countries are pegged at 8 percent, in India, it is more than 15% and the government wants to reduce it to a single digit percentage.  Major contribution to the reduction of the logistics cost is by Transport by air, water and on land. It is clear the supreme importance of Transport in the Logistics domain.

No life is possible without transport. Personally as well as commercially. Just for a moment, think of the things you need for any day to go by conveniently. We use number of things like say toothbrush in the morning to air conditioner in the night for sound sleep. These things reach you simply because of transport.  Transport takes care of your business and also your comfort of personal choices. Business being essentially competitive in spirit and nature, transport thrives on increasing efficiency of all activities involved in a day-to-day living.  What is efficiency and why everywhere efficient people are more in demand? Simple.  When you get a product a little cheaper than somebody else without compromising quality, it means your product has passed through many stages of efficiency.  The manufacturer, the producer, the transport , the warehouse, the distributor, the retailer and many more—all involved in the transportation of things from the place of manufacturing to the place of consumption, that is,  from the businessman to the consumer, have been efficient. Efficiency improves skill required of you at whatever level of business you happen to be in.

Imagine , if all the people of a country get all the things they want through efficient manufacturers to final retailer they spend less on the products, the cost of living, so to say, is rather less. On the other hand, if you are to pay more for the things, it means you spend more on the things; your life costs you more. That is, the intermediaries from the businessman to the retailer for you must have been less efficient. Supposing the individuals are competent, but the means of transport like trucks and the roads they have to use happen to be bad, you must spend more. Simply because, bad roads damage your trucks, more wear and tear, lessspeed, more fuel--- all pinch your pocket.

We will see how transport is linked to logistics cost in our next.