MODULE - 04

TRANSPORTATION
What is Transportation?
Transportation, the movement of goods and persons from place to place and the various means
by which such movement is accomplished. The growth of the ability and the need to transport large
quantities of goods or numbers of people over long distances at high speeds in comfort and safety has
been an index of civilization and in particular of technological progress. The main function of
transportation is to carry the products to different markets, which may be at different geographical
locations.
Apart from transporting the goods, the additional values that transportation provides to the
customers are providing the products on time, in the quantities demanded, and in the undamaged form.
The utility that transportation provides is called 'place utility' and the utility which is created by the
storage is regarded as "time utility". Time utility cannot be provided to a customer without the help of
transportation activities as the speed and the consistency by which a product is moved from one point to
other is determined only by the transportation activities. The activity of transporting something or
someone from one point to other or the activities involved in being transported is termed as
transportation.
Transportation in a supply chain refers to the movement of products from one location to
another, which begins at the start of the supply chain as materials make their way to the warehouse and
continues all the way to the end user with the customer’s order delivered at the doorstep. Because of the
importance of transportation, warehouse managers should examine transportation within their supply
chains. Ultimately, this is the only way to achieve lower total costs for a model where transportation can
account for as much as 60 percent of total operational costs, a significant portion of a company's supply
chain costs.

Role and Importance Of Transportation

Transportation is the means to carry people and goods from one place to another. This has
become very important in each stage of human civilization. If the present means of transportation were
not developed, situation of the world would be totally different.
 Transportation has contributed much to the development of economic, social, political and
cultural fields and uplifting their condition. Speedy industrialization is impossible without development
of transportation. It is unavoidably necessary to promote transport system for the proper development of
agricultural sector and rural areas. Without development of transportation neither mass production nor
distribution is possible.
Transportation helps in mass production. Whether it is to purchase and bring raw materials or it
is to distribute finished goods, one or the other means of transport is necessary. This expands old
markets and creates new ones. As a result, demands for goods increases and production should also be
increased. The contribution of transportation is very important to transport commodities to nooks and
crannies of the world in a little time. If the development of transportation was not made, market would
be limited in local areas and production would be limited to meet local needs only. As a result, economy
of each country would remain in undeveloped condition.
Transportation helps much to the development of different industries, which produce perishable
goods, such as fisheries, poultry firms, horticulture, dairy etc. Transport carries the perishable goods
produced by such industries to the consumers living in different distant places in time. Otherwise such
products would not be possible to supply to the consumers. The role and contribution of transportation is
very important in marketing. The functions of transport in marketing can be discussed as follows.
1. Physical Supply of Products
Transportation carries necessary raw materials to factory for production of goods and supplies
finished goods to consumers. It creates place and time utility of goods by transporting from one place to
another. It easily carries finished to the hands of those who need and use them. This significantly
increases aggregate sales of goods. In fact, transport is such a key of marketing, which helps in carrying
goods to the scattered consumers in different places, narrows the gap between producers and consumers
and facilitates to distribute goods to the consumers at minimum cost and time.
2. Specialization
Transportation facility encourages division of labor and specialization on geographical or
regional basis. Transportation cost highly affects localization of industries. Production of goods may
center at such place where the environment is the best and production cost is minimum. This makes
maximum utilization of local resources possible, which is both economically and socially necessary.
3. Mobility of Labor and Capital
 Transportation facility provides mobility to labor and capital. If more labor force is available at
any place, transport helps to carry it economically to necessary place. The means of transport carry
labors from one place to another. This encourages labor and capital to use and invest in more productive
sectors.
4. Stabilization in Price
Transportation helps to bring stability in price of different products. It transports goods from
more supplied places to scarcely supplied areas. This establishes coordination between demand and
supply, and brings stability in prices. It helps to supply necessary goods regularly to the consumers.
Besides this, consumers get necessary goods at lower prices, because it encourages competition among
producers and makes mass production at lower cost possible.
5. Other Importance
Beside economic importance, transportation has also social, political and cultural importance. It
establishes social and utility by narrowing geographical distance. It consolidates social and cultural
utility and strengthens national integration. It helps to establish relationship with foreign countries.
Transportation also helps widen knowledge and skill in different sectors. In this way, it helps establish
social utility, uniformity and integrity and strengthens national security.
So, transportation plays an important role in physical distribution system. It has also an important
role in marketing function. In the lack of transportation, neither mass production nor distribution is
possible. Transportation is important in social, economic, political and cultural aspects.

Functions of Transportation :
The various functions of transportation are discussed below:
1) Movement of Products:
The fundamental function of transportation is to move the products from one place to another.
The upward and downward movements of products in the value chain are facilitated by transportation.
Transportation is important for moving the material to the next stage of manufacturing process and also
closer to the customer. The material can be in the form of components, assemblies, materials, work-in-
progress, finished products.
2) Storage of Products:
Storing the product in the vehicles for temporary purpose can be seen as another function of
transportation. It can be seen as a costly source of storage but it is less expensive than the cost of
unloading the material in a warehouse for few days and again loading it. Vehicles are used as temporary
storage facility because sometimes the need of storing the in-transit shipment, generally for few days,
arises. Another situation where the transportation vehicle can be used as a storage facility is when the
space in the warehouse is limited.
3) Economic Utility:
As per the economic theories, creating place utility (right place) for the products, distributed and
produced by the firm, can be seen as the main function of transportation. When the goods are placed
where they are to be consumed, it is regarded as place utility. Apart from having the products at the right
place, it is also important to have the product at the right time (time utility) and in right form (form
utility). Moreover, the products should be owned by or in custody of the person who really wants to
consume these products creating 'possession utility'. All the discussed utilities depend the efficiency and
effectiveness of transportation.
4) Geographic Specialization:
When the products are produced in that nation, region, or city which suits best as per the capital,
talent, labour, raw material, and other resources of the company, it as regarded as 'geographic
specialization'. Some level of economic inefficiency can be resulted when such specialization does not
occur. In other words, when a certain region, nation, or city is not able to produce certain products
because of its misfit with some of the factors then the extra resources and efforts need to be applied.
For example, if area A is specialized in product X then it needs to depend on other areas for
fulfilling its need of things other than the product A.
5) Large-Scale Production:
In order to enable the large scale production, any firm will be requiring the collection of different
types of raw material, spare parts, equipment, items from number of sources and from number of
locations. Similarly, after producing the product it should be distributed to a large geographical market
at a reasonable cost. Therefore, transportation is a very crucial element for carrying out a large-scale
production.

Modes of Transportation :
Rail, highways, water, pipeline, and air are the five main modes of transportation. Apart from
these the recently emerged forms of transportation are package carrier, ropeways, and inter-modal
system. Traffic volume, revenue, system mileage, and the nature of traffic composition are the factors
that can be used to determine the comparative significance of each mode. With respect to these
measures, each mode of transportation is explained below:

1) Roadways:
For the agricultural and industrial development of any nation, the most important mode can be
seen as the road transport. This method is quite useful in reaching to short and medium distances, even
to those places where other modes of transportation do not have their reach. The facility of door-to-door
service, which is not possible by other modes, is provided by road transport. In order to bring the trade
from the remote and rural areas to the urban and semi-urban areas, road transportation can be used. With
the help of road transportation the basic infrastructure can be built to ensure the connectivity of far-off
villages with the rest of the nation. Because of the increased demand and a huge development in
industrial and agricultural sector, the significance of road transportation is quite vital for making the
product available at the place and time of consumption. In the transport network of the country, the role
of road transportation is quite dominant.
2) Railways:
One of the principal carriers of men and material in the country is railways which plays a very
significant role in the trade and commerce activities of the country. It supplies essential commodities. to
different locations by transporting across the length and breadth of the country. The industrialization and
development of many nations have been carried forward with the help of railways. During the initial
phase of industrialization many countries were depending upon the railways as it was the main source of
transportation which was available for moving the raw material and finished products from one place to
another. Chemicals, heavy material, farm products, automobiles, and also the low value products are
transported by railways. They have greater efficiency in case of truckloads which can be shipped at a
relatively cheaper price through railways in comparison to smaller modes of transportations. A relatively
lesser handling is required in transporting the goods through railways. In order to facilitate easy loading
and unloading of material, different firms establish their facilities near to the rail lines.
3) Waterways/Sea:
In order to ship heavy, non-perishable, and low value goods (such as coal, grain, ore, and
petroleum products), the cheapest mode of transportation can be seen as waterways. There is a huge
capacity in case of water carriers. Products weighing a minimum of ten times the weight of one rail car
can be transported by waterways powered by towboats, tug boats; barges which move in inter coastal
canals and inland rivers. In fact the vessels which run in oceans can have thousands of containers. There
are a number of markets which are not connected with the waterways without the use of railroad or
trucks. The waterway shipping industry is segmented into various parts which are as below:
• Liner service
• Tramp shipping
• Tanker operations
• Industrial services
Dry bulk carries, container ships, tankers, and special vessels are included in the shipping fleet
around the world. In India, approximately 32% of the total GRT (Gross Registered Tonnage) of the
shipping fleet is contributed by the dry bulk carriers and 33% of total fleet is accounted by the tankers.
4) Airways:
Among all the other modes of transport, the least hazardous mode can be considered as the
airways. The cost of air transportation is quite high; thus, it is mainly used for the transportation of high
valued perishable products with limited life span. The facility of air cargo is mainly concentrated near
the gateway airports e.g, Delhi, Mumbai, Kolkata, Chennai, and Bangalore. About 87% of the total air
cargo is handled by these airports in India. Anticipating the growing needs of cargo airways and
passenger airways, the Government of India is inviting the interested private players in the air transport
services and its associated services such as airports.
5) Pipelines:
 The use of pipeline for transportation of petroleum was first done by Samuel Van Syckel in the
year 1870 in Pithole, Pennysyivania. The face of transportation was changed after twenty years by
Standard Oil Company of North-Western Pennysylvania. The pipeline transportation was first use for
transporting the petroleum but its scope is enhanced by using it for transporting many commodities such
as coal in slurry form, chemicals, natural gas, iron ore fines in slurry form, etc. Although the initial cost
of setting up the network of pipelines is quite high but later it helps in reducing the operating costs.
Almost all public and private sector petroleum refineries use the pipelines for the transportation of
petroleum products. These can be thought of as the most automated mode of transportation which
mainly carries the products of a shipper as it belongs only to a certain shipper. Mainly chemicals or
petroleum products are transported by the pipelines. There are numerous environmentalists who have.
their concerns regarding the effect of pipeline on the environment such as harm to plants and animals
due to installation and leaks.
6) Ropeways:
Out of the total geographical area of India, over 16% is comprised of hilly locations. The
problem of transportation is quite prominent in these locations due to the long circuitous paths.
Sometimes, the transportation of essential commodities and other materials is quite vital due to their
strategic significance in the defense programs of the nation. Ropeways can be seen as the economical
and faster mode of transportation in the hilly areas, especially when the oil shortage is going on. The
various merits of ropeways are as follows:
• Lesser harm to the ecology.
• Shorter routes can be used to reach to the remote hilly locations.
• The cost of ropeway transportation is lesser than the other modes.
• Over short distance, thee transportation of bulky products is quite fast.
7) Package Service:
The country, in last few decades, has faced a huge problem related to the availability of
transportation for small-shipments. Due to the different costs associated with the terminal and line haul
operations, the small-shipment service providers charged quite high prices. The providers cannot
decrease the prices as different overheads impose certain minimum charges on them irrespective of the
size of shipment and the distance of destination. Due to such obstacles, some private companies realized
the potential of specialized services for package-service or small-shipment market.
8) Inter-modal Transportation:
 Taking the economic advantages of two or more modes of transportation by combining them
with each other to facilitate the transportation service at a least possible total cost is known as inter-
modal transportation. In order to combine the various modes of transportations, various efforts are
carried out over the years. The concept of inter modal transportation is not a new concept, it has
originated during the early years of 1920s but in order to control the monopoly practices, different
restrictions were imposed on the cooperative practices. During 1950s, this mode started gaining
popularity as the advantages of road and rail transportation were combined to fora an inter-modal
transportation known as piggy back service. The flexibility of motor or road transport for low distances
and the low line-haul cost of rail for longer distances were combined to form this common inter-modal
transportation. In order to gain the higher efficiency and effectiveness of transportation, the popularity of
inter-modal transportation has increased significantly in recent years.

Transportation Decisions
In general, the most used and important steps in making transportation decisions can be
characterized as a six-stage process. For each stage of the transportation decision-making process, the
engagement one must be undertaken effectively.
These stages are as follows:
• Problem identification: The first stage of the process involves defining the problem to be
addressed. It includes the analysis of the current situation, the identification of objectives, and
constraints, as well as the stakeholders to be involved.
• Option generation: This stage involves the formulation of options and alternatives that look
likely to achieve the objectives defined in the previous step. It includes inputs from key stakeholders.
• Option assessment: This stage includes a technical analysis of each option to determine to what
extent each option meets the stated objectives. In order to assess the different strategic alternatives, a
multi criteria decision analysis (MCDA) can be applied. Ishizaka and Labib claimed that the group-
decision support methods (GDSM) are well suited to be applied as they are able to cope with the
stakeholder-involvement concept.
• Formal decision making: The decision is made by taking into account the views of stakeholder
groups.
• Implementation: This will include a process management plan that defines the detailed program
of activities and schemes.
 • Monitoring and evaluation: This assesses the outputs and outcomes of the implementation
against the process’s objectives.

Factors Affecting Transportation Cost

Transportation is a big part of the logistics picture. Freight can represent 50% of your logistics
cost and up to 10-20% of your retail price. In a world of “free shipping” every importer knows that
freight is not free. Here are 5 factors affecting your transportation costs and how you can manage your
freight expenditures.
1. Market characteristics
Features of your market that affect transportation costs include:
• Amount or degree of competition in your market: can you beat Acme’s price?
• Distance to market: how far your product needs to travel
• Government regulations: such as dangerous goods requirements, over-dimensional
restrictions, or weight limitations
• Traffic imbalance: can you prevent backflow or combine some supplier
shipments/locations
• Seasonality of product movement: differences in shipping costs across the four seasons
• Domestic or international transportation
Not many of the market conditions are in importers’ control and so, they don’t provide much
flexibility on your transportation costs.
2. Product characteristics
Your product itself impacts your freight costs in a number of ways.
 Density
Low-density products tend to cost more to transport per pound. These are bulky items, like
furniture, that may not weight a lot, but their weight to volume ratio is high.
 Storability
How well can your product fill the available space in a transport vehicle. In other words, are you
“maximizing your cube”? For example grain will fill every bit of available space in a container, but a car
leaves lots of empty space around it.
 Ease of handling
 Are your products uniform in size? Are they secured to the pallet so it’s easy for forklift
operators and drivers to work with them? Are your pallets well wrapped and stacked?
 Liability
Look into whether you need cargo insurance on top of the basic legal liability of your carrier (in
general $2 per lb for trucks). Remember that ocean and air carriers have different liabilities consult your
freight forwarder for guidance to make sure you know your options.
3. Volume and frequency
Volume and frequency of shipments can impact your freight costs.
Volume
• Rate leverage
• Lower pick up and drop off costs
• Higher carrier revenue
• Volume commitments/guarantees
Frequency
• Rate leverage
• Better planning and improved performance
• Improved labour and equipment usage
4. Consolidation and cross docking
These are two strategies that can help reduce your freight rates, with one major caveat:
Consolidation and cross docking are done really well by carriers, but importers don’t tend to do it well.
So, in order to see real gains, work closely with your carrier or logistics partner (especially if they have
warehousing capacity to create a distribution center). You’ll likely pay for the service of destruction, but
it’s a value-add as well.
5. Appointments
It may seem very appealing to have appointments with your truckers, ie. the driver will get there
at 9 am. However, appointments mean a lot of waiting time without revenue for carriers and you may
end up paying extra for them. If you can give drivers more flexibility, it can save you appointment fees
or surcharges. The best strategy for impacting your transportation cost is open, honest communication
with your logistics partner or carrier. Transparency and flexibility are essential during these uncertain
market conditions. With more than half a century of international shipping and freight experience, we
are your full-service logistics partner. Contact us today to learn how we can streamline your shipping
operations.

Hazards From Transport Operations

Many different kinds of vehicles are used in the workplace, including dumper trucks, heavy
goods vehicles, all-terrain vehicles, and, perhaps the most common, forklift truck. Approximately 45
workers are killed and over 5,000 injured in workplace transport accidents each year. The third highest
cause of accidental death in the workplace is being struck by a moving vehicle. Approximately a quarter
of all vehicle-related deaths in the workplace occur while a vehicle is reversing. There are also over
1,000 major accidents (involving serious fractures, head injuries, and amputations) caused by:
• Collisions between pedestrians and vehicles;
• People falling from vehicles;
• People being struck by objects falling from vehicles;
• People being struck by an overturning vehicle;
• People injured while inside a vehicle during a collision; and
• Communication problems between vehicle drivers and employees or members of the public.
The term ‘workplace transport’ covers any vehicle used in a work setting, such as forklift trucks,
compact dumpers, tractors, and mobile cranes. It can also include cars, vans, and large goods vehicles
when these are operating at the works premises. A goods vehicle that is loading or unloading on the
public highway outside the premises of work is considered workplace transport. The Regulations that
cover workplace traffic movements are the Workplace (Health, Safety, and Welfare) Regulations. The
ACOP to the Workplace Regulations gives specific advice and guidance on how to comply with them.
The main types of accidents associated with workplace transport are people being struck by
moving vehicles, falling from vehicles (jumping out of cabs or from the tops of high-sided trailers), and
being hit by objects falling from vehicles (usually part of a load). A key cause of these accidents is the
lack of competent and documented driver training. HSE investigations, for example, have shown that in
over 30% of dumper truck accidents on construction sites, the drivers had little experience and no
training. Common forms of these accidents include driving into excavations, overturning while driving
up steep inclines, and runaway vehicles that have been left unattended with the engine running. Each
year, the driving of tractors and other agricultural vehicles, such as all-terrain vehicles, causes several
fatalities in farming and other agriculture-related activities.
Control Measures of Transport Operations Hazards
Any control strategy involving vehicle operations will include a risk assessment to ascertain
where, on traffic routes, accidents are most likely to happen. The risk assessment must examine internal
and external traffic routes, particularly when goods are loaded and unloaded from Lorries. It should also
assess whether designated traffic routes are suitable for the purpose and sufficient for traffic volume.
The following need to be addressed:
• Traffic routes, loading, and storage areas need to be well designed with enforced speed limits,
good visibility, and the separation of vehicles and pedestrians whenever reasonably practicable.
• Environmental considerations, such as visibility, road surface conditions, road gradients, and
changes in road level must also be considered.
• The use of one-way systems and separate site access gates for vehicles and pedestrians may be
required.
• The safety of public members must be considered, particularly where vehicles cross public
footpaths.
• All external roadways must be appropriately marked, particularly where there could be doubt on
the right of way, and suitable direction and speed limit signs should be erected. While there may
well be a difference between internal and external speed limits, all speed limits must be observed.
• Induction training for all new employees must include the location and designation of pedestrian
walkways and crossings and the location of areas in the factory where pedestrians and forklift trucks
use the same roadways.
• The identification of recognized and prohibited parking areas around the site should also be
given during these training sessions.

Ocean Transport
Ocean transport or more generally waterborne transport is the transport of people (passengers) or
goods (cargo) via waterways. Freight transport by sea has been widely used throughout recorded history.
The advent of aviation has diminished the importance of sea travel for passengers, though it is still
popular for short trips and pleasure cruises. Transport by water is cheaper than transport by air, despite
fluctuating exchange rates and a fee placed on top of freighting charges for carrier companies known as
the currency adjustment factor. Maritime transport accounts for roughly 80% of international trade,
according to UNCTAD in 2020.
 Maritime transport can be realized over any distance by boat, ship, sailboat or barge, over oceans
and lakes, through canals or along rivers. Shipping may be for commerce, recreation, or for military
purposes. While extensive inland shipping is less critical today, the major waterways of the world
including many canals are still very important and are integral parts of worldwide economies.
Particularly, especially any material can be moved by water; however, water transport becomes
impractical when material delivery is time critical such as various types of perishable produce. Still,
water transport is highly cost effective with regular schedulable cargoes, such as trans-oceanic shipping
of consumer products and especially for heavy loads or bulk cargos, such as coal, coke, ores, or grains.
Arguably, the industrial revolution took place best where cheap water transport by canal, navigations, or
shipping by all types of watercraft on natural waterways supported cost-effective bulk transport.
Ships and other watercraft are used for maritime transport. Types can be distinguished by
propulsion, size or cargo type. Recreational or educational craft still use wind power, while some
smaller craft use internal combustion engines to drive one or more propellers, or in the case of jet boats,
an inboard water jet. In shallow-draft areas, such as the Everglades, some craft, such as the hovercraft,
are propelled by large pusher-prop fans. The main transport mode for global trade is ocean shipping:
around 90% of traded goods are carried over the waves. As such, the oceans provide the main transport
arteries for global trade. This comes with opportunities and challenges.

Advantages of shipping goods by sea freight

Some of the advantages of transporting goods by sea include:
• You can ship large volumes at low costs - a freight forwarder can consolidate consignments to
reduce costs
• Shipping containers can also be used for further transportation by road or rail
Disadvantages of shipping goods by sea freight

Risks and disadvantages of transporting goods by sea

• Shipping by sea can be slower than other transport modes and bad weather can add further delays
• Routes and timetables are usually inflexible
• Tracking your goods' progress is difficult
• You have to pay port duties and taxes
• Further transportation overland will be needed to reach the final destination
 • Basic freight rates are subject to fuel and currency surcharges.

Global Logic of Strategic Alliances

Strategic alliances are agreements between two or more independent companies to cooperate in
the manufacturing, development, or sale of products and services, or other business objectives. For
example, in a strategic alliance, Company A and Company B combine their respective resources,
capabilities, and core competencies to generate mutual interests in designing, manufacturing, or
distributing goods or services. But managers have been slow to experiment with genuinely strategic
alliances. A joint venture here and there, yes, of course. A long term contractual relationship, certainly.
But the forging of entente, rarely. A real alliance compromises the fundamental independence of
economic actors, and managers don’t like that. After all, for them, management has come to mean total
control. Alliances mean sharing control. The one precludes the other.
In stable competitive environments, this allergy to loss of control exacts little penalty. Not so,
however, in a changeable world of rapidly globalizing markets and industries a world of converging
consumer tastes, rapidly spreading technology, escalating fixed costs, and growing protectionism. I’d go
further. Globalization mandates alliances, makes them absolutely essential to strategy. Uncomfortable,
perhaps but that’s the way it is. Like it or not, the simultaneous developments that go under the name of
globalization make alliances entente necessary.

Types of Strategic Alliances

There are three types of strategic alliances: Joint Venture, Equity Strategic Alliance, and Non-equity
Strategic Alliance.

#1 Joint Venture
A joint venture is established when the parent companies establish a new child company. For example,
Company A and Company B (parent companies) can form a joint venture by creating Company C (child
company).
In addition, if Company A and Company B each own 50% of the child company, it is defined as a 50-50
Joint Venture. If Company A owns 70% and Company B owns 30%, the joint venture is classified as a
Majority-owned Venture.
#2 Equity Strategic Alliance
An equity strategic alliance is created when one company purchases a certain equity percentage of the
other company. If Company A purchases 40% of the equity in Company B, an equity strategic alliance
would be formed.

#3 Non-equity Strategic Alliance

A non-equity strategic alliance is created when two or more companies sign a contractual relationship to
pool their resources and capabilities together.
Learn more in CFI’s Corporate and Business Strategy Course.

Reasons for Strategic Alliances

To understand the reasons for strategic alliances, let us consider three different product life
cycles: Slow cycle, Standard cycle, and Fast cycle. The product life cycle is determined by the need to
innovate and continually create new products in an industry. For example, the pharmaceutical industry
operates a slow product lifecycle, while the software industry operates in a fast product lifecycle.
For companies whose product falls in a different product lifecycle, the reasons for strategic
alliances are different:
#1 Slow Cycle
In a slow cycle, a company’s competitive advantages are shielded for relatively long periods of
time. The pharmaceutical industry operates in a slow product life cycle as the products are not
developed yearly and patents last a long time.
Strategic alliances are formed to gain access to a restricted market, maintain market stability (setting
product standards), and establish a franchise in a new market.

#2 Standard Cycle
In a standard cycle, the company launches a new product every few years and may or may not be
able to maintain its leading position in an industry.
Strategic alliances are formed to gain market share, try to push out other companies, pool resources for
large capital projects, establish economies of scale, or gain access to complementary resources.

#3 Fast Cycle
 In a fast cycle, the company’s competitive advantages are not protected and companies operating
in a fast product lifecycle need to constantly develop new products/services to survive.
Strategic alliances are formed to speed up the development of new goods or services, share R&D
expenses, streamline market penetration, and overcome uncertainty.

Packing Problems In Transportation

Even if packing problems are, from their beginning, strictly linked to Transportation, the recent
advances in this field (Smart City, Last Mile integration, City Logistics) and long-term planning of
cross-country deliveries are forcing researchers towards a broader definition of them. In particular, while
traditionally researchers mainly studied cutting and loading issues, with a special focus on the packing
representation and the introduction of packing constraints like guillotine cuts, rotation and
incompatibility between items, only recently they have started to consider more general issues as multi-
attributes problems, rich packing problems, and uncertainty in the attributes. Aim of this work is to
present the relevant literature, showing the different research directions as well as the new perspectives,
with a special focus on tactical and strategic problems. In more details, we analyze the literature along
the following directions:
• Packing-Routing problems. Traditionally packing and vehicle routing problems, even if
strictly interconnected, have been considered as separate sub problems. The increasing competition and
the presence of new constraints strictly correlating the two issues push the researchers to consider them
as a whole, bringing to new optimization problems and methods.
This inefficiency led in the past decade to the definition of new extensions of the standard
Vehicle Routing Problem (VRP) which explicitly consider the accommodation of the items. The most
studied variant is the so-called Capacitated Vehicle Routing with Two-Dimensional Loading constraints
(2L-CVRP). It is an extension of the basic variant of the VRP where, given a central depot, a set of
customers and the costs of a vehicle driving from the depot to a customer or between two customers, one
aims to find the routes of the vehicles of the fleet minimizing the delivery costs, computed as the sum of
the costs of moving from one point to the other (depot or customer).
• Rich and Generalized packing. Traditionally, packing problems defined in the literature are
more related to the operational level. Recently, with the introduction of packing issues in tactical and
strategic problems, researchers have started to push towards the definition of generalizations and
enrichments of the traditional packing problems. In the following, for reasons related to the paper length,
we will focus on the latest developments on the side of mono-dimensional generalizations. The
optimization of modern Supply Chain systems needs to incorporate flexible methods for addressing
transportation and packing issues. After the generalization process that brought into the definition of the
Rich Vehicle Routing Problems, an analogous process is recently started on packing.
• Uncertainty management. Different sources of uncertainty can affect packing problems, in
particular when they act as sub problems in tactical and strategic supply-chain optimization problems,
like the revenue associated with the shipping of the orders, the volume associated with the flows or the
availability of certain types of containers. Recently, the researchers have started to define and deal
explicitly with these sources of incertitude, both from the stochastic modeling and programming point of
views, and to provide efficient methods to find accurate approximations of the stochastic solutions. The
paper is organized in three main sections, one for each research direction, giving the reader the main
literature references, as well as a quick depiction of the results both in terms of solution quality and
computational effort.

What is containerization?
Containerization is a form of virtualization where applications run in isolated user spaces, called
containers, while using the same shared operating system (OS). One of the benefits of containerization is
that a container is essentially a fully packaged and portable computing environment. Everything an
application needs to run its binaries, libraries, configuration files, and dependencies is encapsulated and
isolated in its container. The container itself is abstracted away from the host OS, with only limited
access to underlying resources much like a lightweight virtual machine (VM). As a result, the
containerized application can be run on various types of infrastructure on bare metal, within VMs, and in
the cloud without needing to refactor it for each environment.
With containerization technology, there’s less overhead during startup and no need to set up a
separate guest OS for each application since they all share the same OS kernel. Because of this high
efficiency, containerization is commonly used for packaging up the many individual micro services that
make up modern apps.
How does containerization technology work?
Each container is an executable package of software, running on top of a host OS. A host may
support many containers (tens, hundreds, or even thousands) concurrently, such as in the case of
complex micro services architecture that uses numerous containerized application delivery controllers
(ADCs). This setup works because all containers run minimal, resource-isolated processes that others
cannot access.
Think of a containerized application as the top layer of a multi-tier cake:
• At the bottom, there’s the hardware of the infrastructure in question, including its CPU(s), disk
storage, and network interfaces.
• Above that is the host OS and its kernel the latter serve as a bridge between the software of the
OS and the hardware of the underlying system.
• The container engine and its minimal guest OS, which are particular to the containerization
technology being used, sit atop the host OS.
• At the very top are the binaries and libraries (bins/libs) for each application and the apps
themselves, running in their isolated user spaces (containers).
Containerization as we know it evolved from C groups, a feature for isolating and controlling
resource usage (e.g., how much CPU and RAM and how many threads a given process can access)
within the Linux kernel. C groups became Linux containers (LXC), with more advanced features for
namespace isolation of components, such as routing tables and file systems. An LXC container can
mount a file system, run commands as root, and obtain an IP address.
Someone booting a container, Dockers or otherwise, can expect an identical experience
regardless of the computing environment. The same set of containers can be run and scaled whether the
user is on a Linux distribution or even Microsoft Windows. This cross-platform compatibility is
essential to today’s digital workspaces, where workers rely on multiple devices, operating systems, and
interfaces to get things done.

What are the main benefits of containerization?

There are many benefits of containerization. Containerized apps can be readily delivered to users
in a virtual workspace. More specifically, containerizing a micro services-based application, a set of
Citrix ADCs, or a database (among other possibilities) offers broad spectrum of distinctive benefits,
ranging from superior agility during software development to easier cost controls.
Containerization technology: more agile, Dev Ops-oriented software development. Compared to
VMs, containers are simpler to set up, whether a team is using a UNIX-like OS or Windows. The
necessary developer tools are universal and easy to use, allowing for the quick development, packaging,
and deployment of containerized applications across OS. Dev Ops engineers and teams can (and do)
leverage containerization technologies to accelerate their workflows.
Less overhead and lower costs than virtual machines. A container doesn’t require a full guest OS
or a hypervisor. That reduced overhead translates into more than just faster boot times, smaller memory
footprints and generally better performance, though. It also helps trim costs, since organizations can
reduce some of their server and licensing costs, which would have otherwise gone toward supporting a
heavier deployment of multiple VMs. In this way, containers enable greater server efficiency and cost-
effectiveness.
Fault isolation for applications and micro services. If one container fails, others sharing the OS
kernel are not affected, thanks to the user space isolation between them. That benefits micro services-
based applications, in which potentially many different components support a larger program. Micro
services within specific containers can be repaired, redeployed, and scaled without causing downtime of
the application.
Excellent portability across digital workspaces. Another one of the benefits of containerization is
that containers make the ideal of “write once, run anywhere” a reality. Each container is abstracted from
the host OS and runs the same in any location. As such, it can be written for one host environment and
then ported and deployed to another, as long as the new host supports the container technologies and
OSes in question. Linux containers account for a big share of all deployed containers and can be ported
across different Linux-based OSes whether they’re on-premises or in the cloud. On Windows, Linux
containers can be reliably run inside a Linux VM or through Hyper-V isolation. Such compatibility
supports digital workspaces where numerous clouds, devices, and workflows intersect.
Easier management through orchestration. Container orchestration via a solution such as
Kubernetes platform makes it practical to manage containerized apps and services at scale. Using
Kubernetes, it’s possible to automate rollouts and rollbacks, orchestrate storage systems, perform load
balancing, and restart any failing containers. Cabernets are compatible with many container engines
including Docker and OCI-compliant ones.

What applications and services are commonly containerized?

A container may support almost any type of application that in previous eras would have been
traditionally virtualized or run natively on a machine. At the same time, there are several computing
paradigms that are especially well-suited to containerization, including:
 • Micro services: A micro services architecture can be efficiently configured as a set of
containers operating in tandem and spun-up and decommissioned as needed.
• Databases: Database shards can be containerized and each app given its own dedicated
database instead of needing to connect all of them to a monolithic database.
• Web servers: Spinning up a web server within a container requires just a few command
line inputs to get started, plus it avoids the need to run the server directly on the host.
• Containers within VMs: Containers may be run within VMs, usually to maximize
hardware utilization, talk to specific services in the VM, or increase security.
• ADCs: An application delivery controller manages the performance and security of an
app. When containerized, it makes L4-L7 services more readily available in DevOps environments.