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Sample Research Essay: Michael Kors
The basis of effective work of any company is a good team of professionals, high quality goods and top-level service that includes highly effective sales department and timely delivery. Logistics is the leading segment in the question of transportation. Let us have a look at the connection between transportation and logistics on the example of Michael Kors Company. First of all, it is important to say that every logistic operation is the path of material flow with the help of different vehicles. Transport is a link between the elements of logistic systems. Transport logistics is moving the required amount of product at the right point, choosing the optimal route for the required time and at the lowest cost. The costs of any product creation are derived from the cost of production and cost to perform the entire job from the moment of purchase of materials until the purchase of the product by the final user. Most of the cost is margins of each link in the manufacturer chain to the final buyer (Kasilingam, 2000). Flow of material from the primary source of raw materials to final consumption also requires costs that can reach up to 50% of the total logistics costs. Vehicles are as a system consisting of two subsystems: transport, intended for public use, and specialized transport. Public transport is sector of the economy that serves the sphere of population circulation. This type of transport is often called the trunk. The notion of public transport encompasses urban, rail, water (sea and river), road and air, and pipeline transport.
Transport that is specialized for transportation of goods is highly productive transport, as well as vehicles of all kinds, non-transport-owned enterprises. That is why it is usually an integral part of any production system (Kasilingam, 2000). Vehicles are involved in a variety of processes, fulfilling the tasks of logistic system, and exist as a self-sufficient transport logistics, which requires a multidimensional consistency between the participants of the transport process.
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The result of the use of the transport logistics system is a very high probability level of implementation of the six rules of logistics: the necessary goods at the right place in the required time period, in the required quantity, quality, delivered cost-effectively.
Providing of technical and technological contingency in transport logistics requires highly effective coordination of economic interests of the participants, as well as the use of common planning systems. Technical integration in the transport sector is the harmonization of vehicles within individual specifics and in the context of inter-specific. This consistency allows the use of modal transportation, work with containers and cargo packages (Kasilingam, 2000). Technological conjugation involves the use of a single technology transportation, direct overload and connection between the two places that is realized without the need of re-loadings. Economic contingency is a general methodology for market research and construction of the tariff system.
Joint planning of logistics system by business participants is the development and application of common terms of graphics. Logistics and planning are essential parts in supply chain management. SCM is a complex approach that helps to effectively integrate suppliers, manufacturers, distributors and retailers. SCM is very effective taking into account the service requirements of customers and ensures availability of the right product in the right place at the right time at minimum cost. SCM is a process of organizing the planning, execution and control flows of raw materials, work in process, finished goods, as well as ensuring efficient and fast service by receiving timely information on the movement of goods. With SCM, it becomes possible to solve problems relating to planning, coordination and management processes of production, supply, storage and distribution of goods and services.
Supply chain is the set of links of interconnected information, monetary and commodity flows. The supply chain starts with the purchase of raw materials from suppliers and ends with the sale of finished services and goods to the customer. Some units may wholly belong to one organization, others to the companies’ counterparties, customers, suppliers and distributors. Thus, the supply chain usually consists of several organizations (Coyle, Novak, Gibson, & Bardi, 2011).
The rapid development of the market, increased competition, the requirement to improve the quality of customer service confronts companies with new challenges. To preserve and enhance the competitiveness of its advantages, the modern company needs to optimize all processes of value creation from raw material supply to service that is offered to the final user. To meet these challenges, management of the companies tries to find reasonable solutions and refers to the SCM solutions (Coyle et al., 2011). If to speak about different kinds of transportation that is used all over the world and in the Company of Michael Kors, the most popular are sea and river transport, vehicles and rail transport. There are also many other kinds of transportation, but all of them have their advantages and disadvantages.
Road transport is traditionally used for short distance. Its advantages include high maneuverability, “door to door" principle with the necessary degree of urgency, they provide regular supply, offer a possibility of supply in small batches and have less stringent requirements for product packaging and other things (Coyle et al., 2011). However, here are the disadvantages: high cost of transport, urgency of discharge, possibility of pilferage and theft of vehicles, relatively small payload and other things.
Rail transport has advantages including transportation of large quantities of goods in any weather conditions, relatively fast delivery of cargo over long distances, regularity of traffic, convenient organization of loading – unloading, relatively low cost of transportation of goods, and the availability of discounts and other privileges (Coyle et al., 2011). Among the disadvantages of such kind of transportation are low speed of movement, limited number of carriers, theft and losses, small possibility of delivery to point of consumption and in some cases it should be complemented by road transport. Another kind is maritime transport. It has the advantages like low freight rates, high capacity of cargo volumes (Kasilingam, 2000). At the same time, it is important to know the following disadvantages: low speed, limited possibility of delivery to points of consumption, stringent requirements for packaging and stowage, low frequency of shipments, significant dependence on weather and navigation conditions.
Besides the maritime transport, there is inland waterway transport. It has such advantage as low freight rates because it is the cheapest transportation of cargo weighing more than 100 tons over a distance of more than 250 km. However, it is necessary to remember the disadvantages like slow speed of delivery, limited possibility of delivery to points of consumption, low frequency of shipments, low geographic accessibility and the necessity to add the road transportation to deliver the gods to the final client (United Nations. Economic and Social Commission for Asia and the Pacific, 2006).
Air transport offers highest speed of delivery, possibility of delivery to remote areas, high safety level of goods. Among the disadvantages of this kind of transport are high freight rates, limiting the size of the party, dependence on weather conditions leading to unpredictable delivery schedules. Finally, the pipeline transportation advantages include low cost and high bandwidth. However, here are the following disadvantages: narrow range to be shipping liquids, gases, emulsions (Kasilingam, 2000). To determine the main mode of transport there are six main factors influencing the decision: the time of delivery, the cost of transportation, the reliability of delivery schedule compliance, the frequency of shipments, the ability to carry different loads, the ability to deliver cargo to any destination.
The correctness of the choice made must be confirmed by technical economic calculations based on the analysis of all costs associated with the different types of transport. Expert assessment of the significance of various factors showed that the choice of transport primarily taken into account includes reliable delivery schedule compliance, delivery time, and the cost of delivery.
Highly developed technology and digital technologies could not but interrupt the transportation and logistics department of every company, including Michael Kors. Using GPS navigation makes the process of searching of the destination place easier; moreover, the program can show the shortest road and calculate the approximate time of the trip. This also allows making highly professional and distinct planning of all the processes that make the work cost-saving, productive and highly effective. Besides GPS navigation systems, there are also such gadgets that let the head office see the situation of the roads and choose the best time and day for delivery with the best weather conditions. The Internet use allows timely communication between the managers and the drivers and lets the company control the deliveries and change the final result even at the last minute in case there was a mistake and it was lately detected; due to the easy access to the drivers, it becomes possible to redirect them and to control the vehicle during the whole time of delivery.
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