Transportation methods

7 04 2010

To transport the unit loads mentioned in the post below there are different transportation methods (getting goods from one location to another):

  • Transportation on the land (In this method the goods can be transported by lorries on the streets or with railways on tracks both have advantages and disadvantages and both are dependent on the infrastructure. If you want to transport your unit loads/goods with railways you would need a good connection to a railway station and the desired destination as well. So you are dependent on the railway tracks. If you chose transporting your goods in lorries you would be as well dependent on the infrastructure (but not on a that high extent that with railway, but lorries are prefered driven on highways on which you have to pay more and more fees for using them). With lorries you are more flexible than with railways but if you have to transport huge amounts of goods along a long distance railways might be cheaper and more efficient. But we also have to consider the steady increasing prices for gasoline which could make transporting with lorries inefficient in the future).
  • Transportation on the water (The transportation with ships is also dependent on the infrastructure of the starting and the destination (you need at least loading/unloading harbours), it is slow but cheap for high amounts of goods and therefore used for transporting much goods from one continent to another)
  • Transportation in the air (Transportation with airplanes is like all ways of transporting goods dependent on the infrastructure. For airplanes you need airports but never the less it’s the fastest way of transportation for medium and long term destinations. But on the other hand it’s very expensive and therefore only used for “valueable” goods).

A special kind of transportation is used for the transportation of crude oil and similiar goods: They are transported through pipelines on the land or under the water across countries and oceans. If you have built the pipeline this kind of transportation is easy to use, cheap and therefore an convenient way of transporting a mass  product like oil.

An overview about different kinds of transportation is given here.

Unit load

7 04 2010
What is unit load about?

Most of the products sold to private and corporate consumer nowadays move along the supply chain packed in unit load. The idea of unit load was to combine many items into one bigger single “unit”. This “unit” can for example be a single container or if we think more simple just a cardboard box which contains six packs of milk.

So as you can see the advantages of unit load are enormous: It facilitates the charging and discharging of transportation vehicles (lorry, ship, plane, train) because with unit load you only have to unload some bigger units instead of many small ones. Furthermore the unit load items like containers are build extremely space-saving and can be stacked easily, this saves place and therefore also money. It is also responsible for protecting the transported goods against damage.

Summing up we can say that unit load makes handling, storage, and distribution of googds more efficient. It’s not just a logistic tool, it furthermore helps to save money!

The “bigger units” in which the smaller items get packed are called Unit Load Devices (ULD) like for example paletts and containers.

Now you should have an overview about the topic unit load. If you are more interested in this topic click this link for additional useful information concerning this topic.

SMED – What is it & what is it good for

4 04 2010

SMED is the shortcut for Single Minute Exchange of Die and it’s a method for reducing waste along the value chain (lean production). It provides a fast and efficient way of converting a a manufacturing process from runnig the current product to running the following product.

The setting up process can be divided into internal and external setting up:

Internal setting up: has to took place directly at the machine -> downtime -> loss of capacitiy (which means also a waste of money)

External setting up: hasn’t to took place directly at the machine -> no downtime -> no loss of capacity

So you see: the main aspect of SMED is to set up preliminarily tools where ever it is possible or in other words try to convert as much internal setting up time as possible into external setting up time (caused due the fact that there is no downtime at external setting up).

Approach at SMED:

  1. Observation and measurement
  2. Seperate internal and external setting up
  3. Convert external -> internal setting up
  4. Rationalize the internal parts
  5. Alignment of a new standard

Requirements for SMED:

  • employees with an adequate qualification
  • time (training of the employees, accomplish the 5 steps mentioned above)
  • capital

Results of SMED:

  • enhancement of the machinecapacity through minimizing setup time
  • customer orientated prodcution ( fast reaction to volatile demands, short throughput times)
  • cost reduction

Similiar methods:

  • Zero-Changeover (setting up within 3 minutes)
  • OTED (=One Touch Exchange of Die)

Umrüsten innerhalb von drei Minuten

nOTED (=One Touch Exchange of Die)

Umrüsten durch eine Armbewegung

Just in time

4 04 2010

Hey logistic fans out there!

Due to semana santa i wasn’t able to blog in the last days but now i am back in business and i’am trying to provide you with the most exciting information concerning the topic logistc.

Firstly i want to tell you something about the principles of Just in Time (JIT), a principle which is based on the pull production system:

Definition: Just in time is the provision of the market with the needed goods, at the time when they are needed, in the appropriate quantity. Read the rest of this entry »

Cost, Price, Value

8 03 2010

Cost, price and value are often used interchangeably but they have distinct meanings:

  • Cost: the cost of your product/service is the effort/amount you spent to produce it
  • Price: is the financial reward for providing the product/service
  • Value: is defined from the customers sight of view and represents their appraisal of                   the worth of the product/service for him/her

These definitions get sharper by viewing on an example:

The cost for a plumber to fix a water-mains burst at a customer’s home may be 15€ for travel, materials costing 5€ and an hour’s labour at 20€. But however, the value of the service to the customer – who may has water leaking all over his/her house – is far greater than the 40€ cost, so the plumber may decide to charge a total of 85€.

So you see the amount of price is not directly related to it’s cost, but in order to make profit there should be a                  Δ(price-cost) < 0.

To increase the aggregated profit the selling person has to find a price which has a great enough Δ to the cost but not a too big one, because then nobody will buy the product.

Graphic origin:


What is Logistics

8 03 2010


  • The term “logistics” originates from the ancient Greek (“logos”—”ratio, word, calculation, reason, speech, oration”)


  • “The branch of military science having to do with procuring, maintaining and transporting material, personnel and facilities.”
  • “The time-related positioning of resources.” As such, logistics is commonly seen as a branch of engineering which creates “people systems” rather than”machine systems.”

→ Logistics is a proccess to ensure that a right item is delivered in the right quantity at the right time at the right place for the right price in the right condition to the right customer.

Hi everybody to the newest blog about Logistics!

8 03 2010

Hey people reading this

Thats my brand new blog for the subject Logistics in the masters program: international product and service management