Recommendations on Transportation and Distribution Essay Example

fast hence the need to be abreast with the current recommendations and international standards. Chinese standards are not very prohibitive unlike European standards. Nonetheless, dealing with trusted brands of electronics, that meet environmental standards’ requirements is a sure way to maneuver. It is also of essential that research is done on “unrestrained competition” practices around the world and especially in target market and evaluate the extent to which they impact transport costs of the quite susceptible electronic goods.
Major Chinese cities are well served by roads as is the case with a few other Asian countries. However, most developing countries, while they are still very attractive destinations for electronics especially mobile phones, their infrastructural development is relatively low. Nevertheless, this ought not to be a hindrance to targeting the markets as they are experiencing a major surge in mobile phone uptake. Moreover, major road works are in progress. In the meantime such flexible modes of transport as the motorbikes may prove quite useful.
It is also of essential that research is done on “unrestrained competition” practices around the world and especially in target market and evaluate the extent to which they impact transport costs of the quite susceptible electronic goods. While there is some level of protecting local industries in both markets that the company is expanding to, there is no overwhelming evidence that it is a concern enough to dent prospects of profitability in both Asia and Europe.

Transportation Methodologies

When moving goods from US to China and Europe, the available options are either ocean freight or air freight. There needs to be a balance between the cost and urgency. While air freight is quite fast, it is

quite expensive compared to the slower ocean freight. Electronics are not perishable hence for most of bulk transport, it is advisable that the company takes advantage of the lower cost of water transport. However, on case by case scenarios, air freight may be used on urgent high end electronics if it is deemed not to increase overhead costs by too big margins.
In the case of EU, once goods are at the port, further transportation to warehouse can be done via either rail or road. Unlike many of Asian countries, Europe has a vast network of roads that is quite reliable. On the other hand Europe also has reliable high speed rail transiting across national boundaries. Further redistribution to different centers and customers can be done using vans or motorbikes depending on volumes after bulk breakdown.

Warehousing and Distribution

Other than meeting the basic principles of a warehouse (design, Storage Plan and efficacy of technology used in daily operations), the warehouse needs to meet certain requirements including considerations that there is limit to stacking and average durations consignments will spend before moving out of the warehouse. Electronics are monetarily valuable commodities that may easily attract break-ins. Therefore, the warehouse needs to be secured using reliable technologies like CCTV other than being structurally fit.
On the other hand, the cost of operating own warehouse should be weighed against outsourcing warehouse and logistics services and determine which option is more viable. Warehouses close to ports and big cities are generally expensive to hire. If they have to be used, co hiring with a likeminded business can be a good way of bringing down the cost. Otherwise, warehouses outside major cities can

as well be used.

Inventory Management

The most modern and efficient trends need to be studied so as to ensure the company only uses the most efficient software and processes to control goods flow in a seamless manner. There are a variety of commercial programs available in the market including Sage that can be used to manage the company’s inventory. Moreover, well trained personnel who are versed and competent in warehouse operations should be hired. As expected, this is highly dependent on the products cycle. As a result it is important than supply is matched with demand so as to avoid unnecessary costs. It is also important that the warehouse uses recent and reliable inventory management programs that can facilitate easy detection of losses and enhance accountability.

Conclusions and Recommendations

By gathering information from various resources and texts, the company will be better placed to make informed decisions in expansion plans. This will be critical in avoiding unnecessary costs impacting on profitability or even having to deal with negative legal implications. Global expansion for any company into European and Asian markets is an enormous undertaking which requires lots of caution to implement right from the onset. While the prospects are promising, any blunders can be extremely costly. The relevant staff need to be trained on how international trade takes place with special emphasis on the particular jurisdictions that the organization is expanding to. On aspects that prove quite problematic to handle, it is advisable that outsourcing is done. Any form of outsourcing must involve reliable companies or individuals with a proven track record.

References

• Asia Briefing, (2013) China Business Handbook; A Resource Guide for Doing Business in the People’s Republic
  

of China