Aa12, Evdencia 1, Essay,physical International Distribution.edited.docx

Actividad de aprendizaje 12

Evidence 1: Writing and essay about logistics costs

LUZ EYDITH BETANCURT ABONCE

Fase Ejecución

Instructor: ELIANA CONSTANZA CARDONA SERVICIO NACIONAL DE APRENDIZAJE SENA Negociación internacional N° de ficha 1565363 2019

Physical International Distribution, logistics and their high costs.

In the physical international distribution, one of the most important parts is count with a good logistics process to deliver its products at the costumes in the right time. For that reason, the entire companies search to have a logistic schedule that gives the chance to deliver all the products at the right time and with good quality. With this, companies can obtain their costumers´ satisfaction. Every single company counts with a special team that is responsible to supervise all the logistics part. For all companies it is very important to count with a logistics plan that fits with all the costumers' needs, that because, the costumes are who receive the final product and with their consumption make grow up the mark in all over the world. We can take, for example, the words said for Sergio Antonio Baladran, who is the actual manager of Mitsubishi in Mexico, about the logistic process: “ The principal mission of the logistic in Mitsubishi Electric, Mexico, is to put our products in the right place, at the right time and with all conditions that the costumers desire, contributing as much as possible to get profitability. The logistic has one objective, to get satisfaction to the demand of all costumes in service conditions, cost, and quality, that is, compliance with costumers requires, it gives a competitive advantage doing with a lower cost, which allows us to get better the benefit. In and outside the company” (AmericaEconomía, 2016) After saying all these things about the importance of the logistics process, we have a questions¿ there is any factor that influences in a negative way in all the logistic process? Of course, there is one factor the difficult all the logistic process and can make this process slower and the factor is the high cost of transportation in the physical international distribution, this factor takes the companies to search for new ways or alternatives to delivering their products, for example, the companies change the products package, for others of lower cost, this way their products can be sent in another kind of transportation that costs less than the others, with this the companies seek to save money, this because the transportation can be more expensive than the production process, the transportation cost cover more than 50% of the cost of production and distribution process.

The high costs in the physical international distribution make that the companies choose to send a very limited quantity of their products, this is because every delivers or shipping, can result in a very expensive inversion that the companies are not being prepared to do.

After we know all the disadvantages caused by the high logistics and transportation costs, ¿ can we say which the advantages are if the high costs can be reduced?

Of course, companies could choose to produce more and in turn, send much more product to their consumer, since what a company currently pays for the shipment of a load, if costs are reduced, would send 2 or Up to 3 times more load than the current one, they would invest more in the production process, thus obtaining a product with a higher quality index, which is the great goal of all producers, since quality means satisfaction, which leads to client to acquire such product in greater quantity.

In conclusion, logistics is the fundamental part of the physical international distribution; the high costs have made it an arduous task for entrepreneurs, since they have an as main purpose, to deliver a product of quality and in the estimated time. If it is possible to reduce at least the costs of transportation, the companies would be benefited in their production and distribution process.