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INCOTERMS PRESENTATION

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Physical
distribution is one of
the
oldest
aspects
of
commercial
enterprise,
has
historically been one of the
most overlooked business topics.
Since the mid-1950s, there has
been a frenzy of interest in the
concept of integrated physical
distribution.
 Physical
distribution is an organised group of
components linked according to a strategy
for achieving specific goals with the
components of customer service,
transportation, inventory control that is how
much inventory a firm should maintain at
each location, protective packaging and
material handling that is how the firm can
efficiently handle goods in the factory,
warehouse and transport terminals, order
processing, warehousing," according to Boon
and Kurtz (2003).
 Essentially,
physical distribution aims to get
products to consumers quickly and cheaply. It
emphasises the importance of achieving
righteousness in all significant aspects of
physical distribution, namely, the right
product, at the right time, at the right place,
in the right manner, for the right people, and
at the right price/cost. It strikes a balance
between price and service.

Order processing refers to the communication
message that starts the physical distribution process
(Croxton, 2003). It includes tasks like product
delivery planning, execution, communication, and
specification (Zhang, Lee & Xu,2010). To ensure a
smooth flow of operations, order processing is linked
to information system technologies (Schlesinger et
al., 2001). The order processing function connects
the warehouse to allow stock visibility and delivery
scheduling. However, in order for information to flow
seamlessly, the information systems of multiple
channel members must be compatible (EspinoRodrguez & Rodrguez-Daz, 2014). Physical
distribution information systems are used to improve
the organization's flexibility and responsiveness, and
they are frequently the glue that holds everything
together (Lau & Lee,2000)
 "Inventory
management is critical in physical
distribution," says Buell (1970). Inventory
control aims to decrease both financing and
inventory variations while also filling
customer orders quickly and accurately.
Inventory costs include acquisition and
storage costs. Management must decide how
much stock to order when it is time to
replenish it. This is facilitated by the notion
of economic customer demand, which is
defined as the volume with the lowest
inventory carrying costs and purchase
processing costs.

The primary function of a warehouse is to store raw
materials and finished goods (Gu, Goetschalckx &
McGinnis 2010).The main activities carried out in the
warehouse are as follows: Receiving, storage, order
picking, accumulation, sorting, and shipping are all
steps in the process (Gu et al.,2010). The warehouse's
location has an effect on the organization's
responsiveness and lead time to customers (Esper et
al., 2007). Inadequate warehousing locations can
result in delivery delays, inefficient distribution, and
higher logistics costs (Chan, Kumar & Choy, 2007). An
efficient warehouse improves the organization's
service levels, resulting in shorter delivery times and
higher customer satisfaction (Shang et al., 2009). The
warehouse should be designed in such a way that it
allows for a continuous flow of goods.

Transportation is the physical transportation of
goods from one location to another, customarily
from the point of origin to the point of
destination, and it becomes significant when it
spans countries and continents (Villarreal, Garcia
& Rosas, 2009). According to the logistics
barometer, transportation is the most expensive
aspect of physical distribution. (Havenga et al.,
2016).Transportation activities include route
planning, cargo tracking, and shipment
notifications (Zhang et al., 2010). Using
transport systems, schedules, and bundling
orders to achieve scale economies improves the
physical distribution of the organisation by
reducing travel distances and increasing load
capacity (Lu & Yang, 2010).

Material Handling encompasses all activities related
to moving products after they have left the
manufacturing plant but before they are loaded onto
a transport vehicle. This activity has existed for a
long time and has now evolved into a system. It
entails using various modes of transportation to
transport goods from the plant to the warehouses and
from the warehouses to the point of loading. Proper
material handling management aids in the avoidance
of unnecessary goods movement, the prevention of
product damage, the facilitation of order processing,
and the efficient movement of goods. Material
handling is a part of the whole physical distribution
systems that contributes to cost reduction and
improved customer service. Material handling system
management that is effective increases the system's
effectiveness.
According to Chan & Choy, 2006 “packaging
logistics is defined as the interaction and
relations between the logistics and the
packaging system that improve “add on” values
to the whole supply chain from raw material
producer to end-user, and the disposal of the
empty package”.
 Protective packaging supplies, simply put, are
materials designed to protect and buffer a
product from potential harm or destruction
during shipping or warehousing. Protective
packaging can be made of any material,
including but not limited to cardboard, plastic,
metal, and so on.

 Depending
on the product contained within,
protective packaging is frequently used as
the primary component of a product's
packaging or as a secondary form of
packaging supply. It is useful for a variety of
applications, but all forms of protective
packaging serve the same purpose: to ensure
that a product arrives in pristine condition,
free of damage or other issues.

Just-in-time (JIT) is a materials management system which
aims to work with zero inventories and to ensure materials
when they are required. JIT has been written about since the
early 1970s. If one search would be made on the researches,
dissertations, papers and manuscripts that were written
about JIT, it is clear that a significant amount of study will be
noticed over the past three decades. JIT takes advantages of
minimum resources and responses in minimum time to the
customers with having minimum waste and using all the
factors of production. JIT management approach has been
proven effective in the manufacturing sector in increasing
productivity, quality and efficiency, decreasing costs and
waste and improving communication (Kee-Hung and Cheng
2009:1). JIT also started to grow in the service sector around
the mid-1990s (Yasin, Small and Wafa, 2003).
 Firms
are forced to implement a wide variety
of innovative managerial tools and
philosophies to react to external and internal
pressures. Over the past three decades just
in time has been one of the most popular
business revitalization for the firms. The
early development of JIT was initiated by
Taiichi Ohno in Toyota’s manufacturing plants
in an attempt to meet customer demands
precisely with minimum delays (Kee-Hung
and Cheng 2009:9).
In opinion of Nikolaidis (2013) TQM is a system
approach that works backwards and forwards
along the supply chain. At the heart of TQM lies
the concept of a continuous improvement and
“customer value”. Value is delivered to the
customer during the “use process”, which
includes all the activities that customer goes
through in using a product: find, acquire,
transport, use, dispose.
 The implementation of TQM philosophy promotes
the integration of the supply chain, builds
positive relationships with customers, improves
the level of logistics customer service and
develops logistics subsystems


Containerization is an intermodal freight transport
method that uses weathering steel intermodal
containers (also known as shipping containers and ISO
containers) to move products. Containers have fixed
dimensions and can be loaded and unloaded, stacked,
transported economically over long distances, and
transferred without being opened from one method
of transport to another, such as container ships, rail
ships, rail transport, flat cars, and semi-trailer
vehicles. The handling method is highly mechanised,
with cranes and special forklift trucks handling
everything. Computerized methods are used to
number and trace all containers. GPS-secured
container seals are being used for freight tracking in
recent advancements.

The essential purpose of a shipping container is
to contain and protect its contents during
transport from manufacturer to consumer. Where
an industrial package is involved, the consumer
could be another manufacturer, and not the
ultimate user of the finished goods. The function
of the consumer container or retail unit is to
provide for a convenient quantity or number of
articles in one unit, which will be purchased by
the ultimate user in a retail shop or store. It is
obvious, however, that to some extent the outer
or shipping container will be complementary to
the inner or retail units.
THANK
YOU
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