(a) What is transportation?
(b) Explain dead freight.
(c) List and explain five factors that will determine a seller’s mode of transportation.
Explanation
(a). Transportation is the movement of people and goods from one place to another.
(b) Dead freight refers to the amount paid by the chatterer for a reserved space not used in a ship.
(c) Factors that determine seller's mode of transport:
(i) Urgency/speed: It will be better to send goods that are needed urgently through the fastest means.
(ii) Type of goods/nature of goods: This covers the nature of the goods, fragile and perishable goods can be sent through air transport while heavy and bulky goods can be sent by rail.
(iii) Destination/distance: This refers to location. Goods going to far places can be sent through a faster means of transport.
(iv) Value of goods: Goods of high unit value, especially those that attract pilferage are better sent by air.
(v) Safety requirement: Goods like examination questions that require utmost security can only be sent by a mode of transport that guarantees security.
(vi) Availability: The choice of transport would be determined by the means of transport that exists in a particular place at a particular time.
(vii) Owner's choice/convenience: This has to do with choice which may be as a result of the class of the owner. Rich people prefer air even for items that can go by road.
(viii) Cost of the mode: The cost of using a particular means may affect the use of the means. It is more costly to travel by air.