Assignment 1 Essay

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Assignment #1: Chapter 1 Questions 1.1 Did it surprise you that logistics has such an important economic impact? Why or why not? I was actually not surprised at all. I have learned that shipping industry has played a major role in our economy and that foreign trade accounted for about 10% of US GPD. As of today about 90% of America’s overseas foreign trade is moved by ships and according to recent projections the foreign trade will be up to 35% of our GPD by 2020. 1.2 Distinguish between possession, form, time, and place utility. Possession utility refers to the value or usefulness that comes from a customer being able to take possession of a product and can be influenced by the relevant payment terms. Form utility refers…show more content…
The main reason for this significance is that meeting customer requirements means that companies must know rather than assume what the customer needs and wants. This knowledge is facilitated by communication between companies and their customers. 1.6 Explain how an understanding of logistics management could be relevant to your favorite charitable organization. The Japan tsunami that took place in 2011 is a great example of this. In a relatively short time a variety of humanitarian organizations like the red cross, with the help of private sector companies, were able to get relief supplies as well as food and medicine into the region and distribute them to the affected population. 1.7 How has a reduction in economic regulation contributed to the increased importance of logistics? Reductions in economic regulation in the United States allowed individual carriers flexibility in pricing and service. This flexibility was important to logistics for several reasons. It first provided companies with the ability to implement the tailored logistics approach in the sense that companies could specify different logistics service levels and prices could be adjusted accordingly. Second. The increased pricing flexibility allowed large buyers of transportation services to reduce their transportation cost by leveraging large amounts of freight with a limited number of carries. 1.8 Discuss the logistical implications associated

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