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AU / OTHER / SCMN 3720 / exw study guide

exw study guide

exw study guide


School: Auburn University
Department: OTHER
Course: Transportation: Management of Product Flows
Professor: David strickland
Term: Spring 2017
Cost: 50
Name: SCMN 3720 Final Exam Study Guide
Description: Comprehensive study guide covering all recent chapters and group presentations. Does not include material covered in articles.
Uploaded: 04/30/2017
14 Pages 155 Views 1 Unlocks

What is a bill of lading?

What are Incoterms, what organization developed them, how many are there?

What is a maquiladora?

SCMN 3720 Final Exam Study Guide o Material Covered: • Ch. 10-14 • Company presentations ???? Transportation mode ???? HQ location ???? Year founded ???? Geography served ???? Primary service offered • Top 5 Articles: ???? UPS Saturday delivery ???? Hyperloop ???? Norway Ship Tunnel ???? CA DMV autonomous vehicle testing ???? United AirliIf you want to learn more check out what are prohibited powers
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nes Incident  • FC/VC word problem • One question about guest speaker on 4/26 Chapter 10 o Global export value • Increased 6% per year • High demand  • Compete to secure capacity o Global transportation • $700 billion U.S. trade deficit • $900 billion spend on global transportation o Trade Agreements • Remove barriers, make trade easier • Bilateral: 2 countries ???? U.S. in 20 bilaterals o Flows 1. Goods  2. Information 3. Payments  • Supply chain much more complex o Terms of trade • Responsibility for mode, carrier, routing • Payment, insurance, duties • Responsibility o Terms of Payment • Exporters: risk of nonpayment • Importers: risk related to shipment and delivery o Communication • Companies, countries• Proper documentation ensures compliance o Distribution • Multiple handoffs • Many people involved • Many countries and laws, etc o *Global trade very complicated o Planning • Prepare • Prepare for export ???? Trade terms  ???? Insurance ???? Payment terms ???? Documents • Transport decision ???? Routes ???? Safety  o Incoterms • Established by ICC • Short hand for common language for importers/exporters and who takes  care of what • 11 total • most friendly to exporter: EXW ???? buyer takes care of everything • most friendly to importer: DDP ???? supplier takes care of everything • role of incoterms ???? don’t supply all contract terms ???? simple lanaguage to setup shipping ???? who does what o Export prep activities • Financial risks ???? Dollar limitations on ocean carrier liability • Transportation perils ???? Jettison: not reliable for product dumped if felt like it would save  rest of ship/crew • 50/50 rule: if your stuff gets dumped and other customer  doesn’t average the loss o Managing risks • Retain  ???? Large company ???? Low value goods • Transfer ???? Insurance o Terms of Payment • Cash in advance ???? Pay before shipment• Letter of credit ???? Documents to bank after shipment • Sight draft ???? Pay when presented to buyer • Time draft ???? Pay at maturity of draft • Open account ???? Pay as agreed, invoice o Freight documentation • Invoices, import/export documents o Comparison of modes: what is each good for o Carrier selection • Price • Geographic coverage • Reliability • Select both mode/company • Strategy:  ???? Leverage purchasing dollars ???? Build relationships CHAPTER 10 1. Which countries are the top 3 trading partners with the U.S. (imports as well as  exports)? a. Imports: China, Canada, Mexico b. Exports: Canada, China, Mexico 2. What is a maquiladora? a. Foreign factory in mexico who exports back to home country 3. Explain the concept of transfer of ownership and why this is important. a. Responsibility for management/transfer of goods b. Buyer/seller understanding of who’s liable  4. What are Incoterms, what organization developed them, how many are there? a. International chamber of commerce b. 11 5. Which Incoterm has the lowest risk to the seller? a. EXW b. Ex works 6. Which Incoterm has the lowest risk to the buyer? a. DDP b. Deliver duty paid 7. What is NAFTA? a. North American Free Trade Agreement b. Canada, Mexico, U.S. c. 1994, Clinton Administration d. Lifts tariffs/trade barriers8. What is a bill of lading? a. Contract between shipper and carrier b. Cargo receipt 9. Explain the differences between these 3 types of payment terms: cash in advance,  open account, letter of credit • Cash in advance: Pay before shipment • Open account: Pay as agreed, invoice • Letter of credit: Documents to bank after shipment ???? Third party involved ???? Makes sure you get paid as agreed upon ???? Ensures everyone gets what they agreed to Chapter 11 o Transportation Services • Direct: single mode and carrier • Indirect: multiple modes and carriers ???? Pick up, line haul, delivery ???? Carrier typically makes decision of which combination to use o Prepare Freight for movement • Packing problems ???? Breakage, moisture, theft, weight • Insurance risks ???? Extended origin to destination distance ???? Number of transfers between carriers ???? Varying climatic conditions • Documentation ???? Invoices ???? Export documents ???? Import documents ???? Transportation documents o Ocean Shipping • Private: ships owned or leased on a long term basis by the company  moving the goods • Charter: operate in geographic regions defined by customer • Liner: serve particular trade area ???? Specific routes and pay to use available space • Equipment types ???? 47,547 cargo ships in world ???? Containerships ???? Break bulk ships ???? Roll-on/roll-off (RORO) ???? Bulk carriers ???? Combination ships • Current issues ???? Ultra large containerships (ULCS)• Limits potential routes: too big for some • Port congestion • Load factors o Air Cargo • Freighters: specifically cargo • Passenger: extra space in cargo hold given to cargo • Current issues ???? Near shoring and on shoring ???? Trade protectionism ???? Economic conditions: fuel prices o Trucking • Dominant mode in N. America ???? 63% • Current issues ???? Rules/regulations ???? NAFTA: countries in agreement must adhere to U.S. regulations  and causes some problems with Mexico o Railroads • Very standardized • 15% o Ancillary services • International freight forwarder ???? Help importers/exporters move goods ???? Kuehne and nagel o Seaports • Majority of international trade flows through small group of major deep  draft commercial seaports • Only L.A. in U.S. • China has most and largest capacity • Owned by governments managed by port authority • Issues ???? Congestion ???? Infrastructure problems ???? Increasing size of containerships o Airports • Duel service: cargo/passenger • Busiest: Memphis, TN • Infrastructure: ???? Separate terminals for cargo • Issues ???? Congestion ???? Infrastructure  o Customs Clearance 1. Entry filing 2. Arrival 3. Examination4. Classification 5. Taxation 6. Release  CHAPTER 11 10. What is the primary difference between the two global freight service options— direct service and indirect service? a. Direct: single mode and carrier b. Indirect: multiple modes and carriers 11. What are the 3 primary benefits of intermodalism? a. Facilitates seamless global trade b. Greater accessibility by linking modes c. Overall cost efficiency 12. What is a TEU? a. Twenty foot equivalent unit b. Describes the capacity of container ships 13. What does transload freight mean, and what types of goods are involved? a. Goods that must be handled individually and transferred between  transportation equipment multiple times.  b. Primarily consists of bulk-oriented raw materials 14. What is a land bridge? a. Combination of ocean-rail-ocean intermodal transport 15. What are the differences between liner service, charter service, and private service  for ocean transportation? a. Private: ships owned or leased on a long term basis by the company  moving the goods b. Charter: operate in geographic regions defined by customer c. Liner: serve particular trade area 16. What is a RORO ship? a. Roll on/roll off b. Drive directly onto ship to load 17. What is the top container line in the world? a. Maersk 18. What is the top air cargo carrier in the world, and what are the top two that are  based in the USA? a. Emirates b. Fedex and UPS 19. What are the top seaports in the world in thousands of tons and in TEU’s? a. TEUs: shanghai b. Thousands of tons: Ningbo Zhoushan 20. What is the top cargo airport in the world and the top one in the USA? a. Hongkong b. Memphis21. What are the steps in the customs clearance process? a. Entry filing b. Arrival c. Examination d. Classification e. Taxation f. Release  22. What is a foreign trade zone? Sites within the US or near the US customs port of entry where foreign and  domestic goods are held without time limit until they are ready to be released  into international commerce. Chapter 12 o 3pL companies provide logistics services as an outsource o Types of providers • Resource ownership • Primary service • Depends on where roots are o Resource ownership • Asset based: has own equipment and labor force ???? Examples: UPS, Fedex ???? Advantages: readily available capacity ???? More control ???? High FC • Non asset based: do not own means of transportation ???? Contract with other firms ???? More flexible ???? Less control ???? Lower cost o Primary services • Transport based ???? Business origin in freight movement ???? Manage transportation operations • Distribution based ???? Business origin in public or contract warehousing • Forwarder based ???? Freight forwarders, brokers, agents ???? Arrange services/shipments • Financial based ???? Specialize in monetary issues ???? Freight payments, electronic payments • Information based ???? Digitized activities ???? Licensed software ???? Transportation management systems o Types of services• Freight movement ???? Fore hire, contract, expedited • Management ???? Carrier selection, routing, scheduling ???? Performance analysis ???? Contract compliance • Intermediary ???? Forwarding between modes ???? Intermodal marketing • Specialty ???? Contract carriage ???? Drayage: lack of accessibility ???? Merge in transit o Revenues • 10% GDP • US: $150 billion o Outsource v. Inhouse • What should you specialize in • Focus on your core competencies  • Ex: cars ???? Design, outsource production of parts, put together at end in house • Primary activities outsources: ???? Domestic tranportation ???? International transportationChapter 13 o Private transportation • Serves itself by hauling own raw materials or final products • Haul goods for others free of charge • Available in each mode ???? Trucking most prominent o Private Rail • Private owned railcars by common carrier railroad • Common in businesses that require customized rail service • Usually includes private or spur track that detaches and goes to customers  rail house o Private Air • business related travel • high costs offset by: ???? time saved ???? security ???? provide transportation to smaller, more remote locations o Private Water • Bulk, large volume, low value • Limited origins/destinations • Requires large capital investment o Private pipeline • Major oil companies own for-hire pipelines • Market control • Mitigates high start up cost • Provides requisite economic volume of shipper owner traffic o Private trucking • Advantages:  ???? Improved service: convenience, flexibility, lower transit time ???? Lower cost: reduced transport costs, lower inventory levels • Disadvantages:  ???? Higher cost: empty backhaul, added overhead, capital requirements • Costs: ???? FC: depreciation, interest, management, office/garage costs ???? VC: labor, vehicle operating (fuel, etc), insurance, taxes/fees • Operating decisions ???? Equipment: purchase or lease • Full service lease: vehicle plus operating support services.  Good if requires maintenance • Finance lease: only financing of the equipment ???? Organizing fleet: • Cost constrained: avoid conflicts of user demands and  private fleet goals • Profit center: private transport is not free • Position in organization: centralized or decentralized???? Controlling cost and performance: functional v operations ???? Regulations • Private carriers exempt from federal economic regulations • Still subject to safety regs ???? Eliminating empty backhual • Eliminate miles traveled without a load • Lease space to someone to avoid  • Shipment of exempt commodities like agricultural products CHAPTER 13 1. Describe the primary way private transportation is used for each mode. a. .Air - Private planes used for transportation for executives b. b.Rail – companies own rail cars, c. c.Motor- over half shipped domestically most important  d. d.Sea- company own ships for transportation of own goods e. e.Pipeline- own pipeline and lease them out 2. What are the advantages and disadvantages of private trucking? a. Adv: improve service, lower cost, more control b. Dis: higher cost, more hassle 3. What are the two highest operating cost categories for private trucking? a. Labor and fuel b. Same for non private 4. What is a backhaul and how is this significant in private vs. non-private  transportation? a. Return trip after initial haul to destination b. Private: can lease out backhaul so its not empty and you’re making money  off of it Chapter 14 o Key issues for Global Supply Chains: • Transportation infrastructure • Supply chain technology • Sustainability • Fuel cost o Infrastructure  • Congestion: high cost impact ???? Trucking • US annual cost 2013-2030: $2.8T • 2030: $186B • Highway congestion worst o Wastes time and fuel ???? Rail • Capacity needs to be increased • By 2015: 30% of network congested ???? Waterway• Bottlenecks due to aging infrastructure and locks • Deep draft ports have capacity challenges • Need wider/deeper waterways for larger ships • Houston, TX most crowded o Technology • Collaboration powerful strategy that leads to improvements • Tactical/operational ???? Reduce loading/unloading times ???? Increase hours of operation ???? Allow faster payment • Strategic ???? Vendor managed inventory ???? Electronic data interchange ???? Radio frequency identification  o Sustainability • US among top contributors to CO2 emissions from fuel combustion • Carbon footprint: how much CO2 produced • Transportation second largest contributor of GHG (greenhouse gas)  emissions • Don’t ship air: deflate products • Don’t ship water: fill with product closer to location • Green transport:  ???? improve fuel efficiency ???? clean fuel ???? network mileage optimization o Fuel Cost and Consumption • Price volatility affects most modes, but truck and air the most • Airlines most intensive users of fuel • Carrier’s responses: ???? Fuel surcharges and contract clauses ???? Service capacity and network rationalization ???? Improve operational efficiency CHAPTER 14 1. Discuss how congestion, sustainability, and fuel cost volatility are impacting the  transportation industry. a. Congestion: fuel, infrastructure has not kept up with growth b. Sustainability: green transport to improve fuel efficiency c. Fuel cost volatility: high. Costs more to ship things, so look for  cheaper/more efficient ways to ship things 2. Explain the significance of the phrases “don’t ship air” and “don’t ship water”. a. Air: empty space that’s wasted b. Water: shipping liquids is heavier and more costly 3. What is the top port in the USA in vessel calls? a. Houston, TX4. What is the top country in the world in vessel calls? a. China Explanation of word problem o Profit increase: high FC o Q4:  • Revenue = $10m • TC = FC + VC = $9m • Profit = revenue – TC = $1m o Q1 following year: • Revenue and volume increase 10%, what is the increase in profit? • Revenue = 10 + (10*.1) = $11m • FC doesn’t change = $6m • VC increases 10% = 3 + (3*.1) = $3.3m • Profit = $1.7m = 70% increase Group presentations o AAA cooper • Transportation mode: trucking • HQ location: Dothan, AL • Year founded: 1951 • Geography served: north America, mostly southeast • Primary service offered: LTL, transport, logisitics services • AU alumni in exec roles:  ???? Reid Dove, CEO ???? Mark Dove, Chairman ???? Charles Pricket, EVP and COO o Colonial  • Transportation mode: pipeline • HQ location: 1961 • Year founded: Alpharetta, GA • Geography served: Houston, TX – Linden, NJ • Primary service offered: fuel transport o Fedex • Transportation mode: air and trucking • HQ location: memphis • Year founded: 1971 • Geography served: global • Primary service offered: package transport • Business plan created as an assignment for a class o XPO • Transportation mode: water, air, ground • HQ location: Greenwich, Connecticut  • Year founded: 1966 • Geography served: global, mostly N. America and Europe • Primary service offered: logistics, transportationo Swift • Transportation mode: trucking • HQ location: Phoenix, Arizona • Year founded: 1966 • Geography served: North America • Primary service offered: trucking transportation o Landstar • Transportation mode: multiple • HQ location: Jacksonville, FL • Year founded: 1988 • Geography served: North America, mostly U.S. • Primary service offered: non-asset based 3PL o Jetblue • Transportation mode: air • HQ location: Long island, NY • Year founded: 1998 • Geography served: mostly east coast • Primary service offered: passenger air travel o Schneider • Transportation mode: trucking • HQ location: Green bay, Wisconsin • Year founded: 1935 • Geography served: North America • Primary service offered: transport o Kinder Morgan • Transportation mode: pipeline • HQ location: Houston, TX • Year founded: 1997 • Geography served: north America  • Primary service offered: energy infrastructure, natural gas  o CSX • Transportation mode: rail • HQ location: Jacksonville, FL • Year founded: 1980 • Geography served: mostly east coast • Primary service offered: rail transport o BNSF • Transportation mode: rail • HQ location: fort worth, TX • Year founded: 1995 • Geography served: central US, some west coast • Primary service offered: bulk rail transport o Kuehne and Nagel • Transportation mode: all • HQ location: Switzerland • Year founded: 1975• Geography served: global • Primary service offered: logistics coordinator, transport luxury goods o Maersk • Transportation mode: water • HQ location: Baltimore, Maryland • Year founded: 1928 • Geography served: global, 121 countries • Primary service offered: container ship transport o UPS • Transportation mode: trucking and air • HQ location: Oakland, CA • Year founded: 1907 • Geography served: global, 220 countries • Primary service offered: package transport o American Airlines • Transportation mode: air • HQ location: Dallas, TX • Year founded: 1930 • Geography served: global • Primary service offered: passenger air travel

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