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• Military

• Production

• Business

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Delivered Duty Unpaid vs Delivery Duty Paid

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Delivered Duty Unpaid vs Delivery Duty Paid

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If a business cannot count on getting materials when they need them, production slows down or stops altogether. This can happen due to supplier issues, natural disasters, or unexpected demand spikes. For example, during COVID-19, many businesses struggled because suppliers couldn't deliver parts on time, leading to empty shelves and production delays.

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Oil prices directly affect transportation costs. When oil prices go up, it becomes more expensive to ship goods, whether by truck, ship, or plane. This can raise the overall cost of products. For example, airlines and trucking companies increase freight rates when fuel costs rise, which impacts the final price for consumers.

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Unrest or conflict in supplier countries can interrupt the supply chain. Governments may close borders, block exports, or even take control of industries. For example, the war in Ukraine disrupted the global wheat and energy supply, causing shortages and price spikes around the world.

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Raw material extraction:

This is the starting point of the production process, involving the acquisition of raw materials from nature or suppliers. These raw materials are the basis for manufacturing products.

- Example: Mining minerals

2. Logistics:

After the raw materials are extracted, they need to be moved and stored through the logistics system. This includes using warehouses and a large number of storage facilities to ensure the safety and effective management of raw materials.

3. Manufacture

At this stage, raw materials are transformed into finished products. This involves a series of processing, assembly and quality control steps to ensure that the product meets the design specifications and quality standards.

4. Logistics:

After manufacturing is completed, the finished products need to be moved and stored again through the logistics system. This includes using distribution centers and warehouses to manage the distribution of products.

5. Retail stores and/or consumers:

The products eventually reach retail stores or directly reach consumers. This is the stage of product sales and consumer usage.

6. End use:

This is the end of the production process, when the product is used by consumers and its life cycle is completed.

The entire flowchart demonstrates a circular economic system, in which logistics plays a crucial role in connecting various production stages, ensuring that raw materials, work-in-progress and finished products are available at the right time and place.

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Physical distribution is the movement of finished goods from the business to the end user. It includes:

Warehousing

Inventory control

Order processing

Transportation

Customer service

This is the final step in the supply chain and can strongly affect customer satisfaction and brand reputation. also a strong logistics system means that products arrive on time, in good condition and at a reasonable cost.

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Benefits of Supply Chain:

1. Faster delivery to customers

A well-organized supply chain ensures that products reach customers quickly.

2. Reduced operating costs

An efficient supply chain reduces the cost of warehousing, transportation, and handling.

Example: Walmart saved billions of dollars by adopting just-in-time inventory.

3. Improved customer satisfaction

Reliable delivery and product availability are sufficient to satisfy customers.

Negative impacts of supply chain

1. Vulnerability to disruption

Some force majeure factors (such as natural disasters, political issues or epidemics) may cause supply chain disruptions.

For example: COVID-19 has disrupted global shipping and factory production.

2. High installation and maintenance costs

Building a strong supply chain requires significant investment in technology, warehousing and transportation.

3. Complex management

Supply chain not only needs to manage multiple suppliers, but also warehouse matters and freight routes are very complex and need to be carefully checked and coordinated.