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Test 4 Strategic Transportation Management
1. What are the principal documents required for the international transportation of physical
goods? Name and explain at least three.
2. Automobiles, bananas and oil move through multi-modal transportation systems. Compare the
three systems. How do they differ? What are the bases for those differences?
3. What additional measures must carriers take when they are hauling hazardous materials like
lithium ion batteries? Are the carriers the only entities responsible for taking these measures?
Michelin Tires
Kellie Southwart, Tommy Chau, Justin Tisler, Matt Dziadon, Samuel St.Ores, Travis
Minor
Michelin Introduction
Humble Beginnings
Dual Nature
Problem Statement
In 1898, started as a small
tire business and factory in
France for only 8,000
automobiles.
Is to commit to serving
consumers globally by
keeping people safe, having
continued transportation,
and reliably securing the
longevity of goods and
services to move forward.
“When it comes to
distribution buildings, there
is a lot riding on them, just
like our tires. Because our
products are complex,
varied, and there are many
fluctuation points in the
demand schedule, a
distribution center serves as
the crux of the entire
operation.”
Was the first to be able to
detach the rim and tire
instead of replacing the
entire wheel unit.
Manufacturing Process
?
Rubber is used to form the inner
liner, casing ply, and sidewalls
which are conformed together
?
Metallic and textile belts are
added for rigidity
?
The tread band is formed and
applied to the carcass
?
The tire is cured and molded then
checked for quality before
distribution
Path of Travel
Farmers and
Refineries to Ports
Farmers harvest rubber
and refineries produce
synthetic rubber in
Indonesia then transport
it to ports where it’s
loaded in containers and
onto ships for worldwide
distribution.
Ports to
Manufacturing
Plant
Bulk rubber is shipped
via trans-oceanic
containerships to U.S.
ports and from the port it
is shipped by rail to
Michelin’s South
Carolina tire
manufacturing plant.
Manufacturing
Plant to Final
Consumer
Tires are shipped by
truck to domestic
markets or by rail to
ocean ports to be
delivered to nondomestic markets.
Vehicle
?
The vehicle most often used for transporting raw materials and the
finished tires is a shipping container and tractor trailer. Sometimes
flatbed trailers are used to transport tires that can weigh in excess of
10,000 lbs.
?
Michelin and its suppliers use water transportation to get their rubber
materials from Indonesia to the United States on container ships and
then land transportation from the port to the manufacturing facilities
using a shared rail system with automobile and other tire manufacturers.
?
Suppliers use pipeline and liquid bulk containers to move refined
butadiene directly from PT Petrokimia Butadiene Indonesia (PBI) to PT
Synthetic Rubber Indonesia plant.
Deep Ocean Shipping
?
Solid rubber blocks between 45 and 65 pounds are wrapped in
plastic, palletized, then placed in shipping containers for transoceanic transport.
?
Liquid rubber is put into tank containers for trans oceanic
shipping.
?
Michelin transports majority of its rubber shipments FOB
Origin.
?
Completed tires are also loaded in shipping containers for
oceanic transport to non domestic markets.
?
Michelin ships most finished tires FOB destination
Motive Power
Waterway Transportation:
?
For deep ocean ships, the motive power is a diesel motor which propels the ship from port to port.
Truck Transportation:
?
For trucking the motive power is a diesel motor. Many different factors have an impact on gas
mileage.
? Speed
? Engine upkeep
? Weight being transported
Rail Transportation:
?
Trains are powered by diesel motors that efficiently pull freight along tracks.
Terminal
? Rail Transportation: Greer, South Carolina to Charleston, South
Carolina
? US-10 plant is considering the SCPA’s new inland port
? The US-10 is located 42 miles from Greer
? The SCPA shouldered $43.5 million of the total
? Water transportation: Ports at Savannah, Georgia and Charleston,
South Carolina
? Decided to invest $750 million in South Carolina
? Why South Carolina?
Required Infrastructure
? Farmland for rubber trees to grow natural rubber
? Ocean ports to distribute rubber world wide
? Highway roads for trucks to deliver tires domestically
? Pipeline for moving liquid raw materials which make up synthetic rubber
? Gantry cranes for loading and unloading containers on ships
Information System
? ELD monitoring for trucks
? Smartdrive for monitoring trucks safety
? Tracking systems for boats
?
GIS for monitoring pipelines
People
There are 22,000 people employed
by Michelin Tires
8,550 are employed in SC
South Carolina Plants
Skills for builders:
?
?
?
?
Strength/Physical fitness
Communication
Commitment
Quality work
People’s roles in transportation
Water:
? Captains, crew members, port crew
Land:
? Truck drivers, terminal employees
Rail:
? Conductor, terminal employees
PT Petrokimia Butadiene Indonesia (PBI)
-Subsidiary of Barito Pacific
-Butadiene facility uses Mixed C4 as its raw material
-This plant consumes Mixed C4 and natural rubber to
produce butadiene.
Butadiene is a critical feedstock to produce synthetic
rubber which is one of the raw materials for tires
production.
-Butadiene itself is a raw material for Styrene Butadiene
Rubber (SBR); SBR is the main feedstock to produce tires.
Tier 2
Supplier
Tier 1
Supplier
Retail consumer
Tire Manufacturing
Michelin,
South
Carolina
PT Synthetic Rubber Indonesia
-a joint venture of Indonesia’s Chandra Asri
Petrochemical, aka CAP, (Barito Pacific is majority
stakeholder of CAP) and French tire maker Michelin
-The JV firm invested US$570 million million to develop
the plant, with a target to produce 120,000 tonnes of
synthetic butadiene rubber and solution styrene
butadiene rubber every year.
Tier 1
Customer
Tier 2
Customer
Walmart
-Retail Center.
-Shipments received by truck. Walmart Distribution
warehouses tires that came from Michelin
manufacturing and warehouse center.
Numbers
?
It costs $1605.00 to transport a 40 foot container.
? Only about 1,500 tires can fit into a 40 foot container.
? 40 foot containers tightly packed can hold 80,000 pounds of raw
rubber, this can make about 4,705 tires.
? An average tire weighs 35 pounds, an average semi truck tire
weighs 105-110 pounds, and an average commercial airplane tire
weighs 400 pounds.
? With shipping costs per 40 foot container being equal due to
freight classes, it is at minimum 3 times more cost effective to ship
raw rubber compared to finished tires.
Conclusion
? We believe that Michelin should continue transporting raw rubber
from Indonesia and manufacturing the tires in the United States.
The cheaper Indonesian labor costs would make up for the cost of
transporting already made tires to the U.S. market.
Team: Toyota
Matthew Sullivan
Andrew Berteau
Mark Harris
Nic Bell
David Petrey
Toyota Facts
? First car produced in 1933
? 31,000 employees
? Exported to America in 1953
? Car costed $875 in 1930
Our Modes of Transportation
Rail: time is unreliable, limited routes, most of time requires another mode, fairly
inexpensive (1.9 billion tons worth $512 million)
Truck: time is reliable, route anywhere there is a road, most common mode,
most expensive, typically short distances (12 billion tons worth $10 million)
Ocean: time consuming, cheap costs, route very accessible, mass
transportation (825 million tons worth $279 million)
Who Owns the Car in Transport?
Free on Board Shipping Point
? Sale recorded at point of shipment
? Buyer should record increase in inventory
? Buyer is responsible for shipping costs
? If a crash occurs, buyer must file insurance claim
Who Owns the Car in Transport?
Free on Board Destination
? Sale recorded when sale reaches destination
? Ownership changes when buyer receives cars
? Seller responsible for shipping costs
? Buyer records inventory when sale occurs
Steel Production
Japan
? Nippon Steel 4th largest steel manufacturer in the world
? Partnered with Toyota
? Tsutsumi Toyota
? Steel depreciation
Manufacturing
? Cars built in 18 hours
? Production Instructions Sheet
? Stamping, Welding, Painting, Assembly, Inspections
Delivery from Production Plant
? Cars gathered in finished car yard
? Before shipment must be checked for quality
? Protecting during shipment
? Loaded and secured onto rail cars for delivery to port
? Delivered to storage yard
Ocean Transport
? Vehicles will arrive at the port; loaded onto the cargo ship.
? RO-RO Method
? 60 ships per month to transport automobiles; 4 to 5 thousand cars per ship.
? Bill of lading will be issued by the carrier
? FOB terms
A Green Ocean Transportation Initiative
? Environmentally friendly ships fueled by liquefied natural gas
Port of LA/Long Beach to Toyota of
Hollywood
? Motor carrier to Toyota of Hollywood
? Less than an hour haul
BlockChain Explained:
Elements
Vehicle- Trucks, Cargo Ships, Rail Car
Motive Power- Vehicle engines, Ship Propellers, Locomotive
Path of Travel- Roads, Railways, Ocean
Terminal- Ports, Distribution Center, Warehouse, Car Dealership
Information Systems- GPS tracking for Ships and Trucks, Block-chain
People- Captain, Production Employees, Truck Driver, Train Conductor, Port
Workers
Questions?
Sources

Toyota Supply chain Management from Siddhi Suthar

http://www.toyota-global.com/company/history_of_toyota/75years/data/automotive_business/production/logistics/product/completed_vehicle.html

FOB (How it Affects Ownership of Inventory)


http://www.toyota.co.jp/en/kids/faq/o/01/03/
https://asia.nikkei.com/Business/Toyota-to-go-green-in-moving-cars-by-sea
https://www.cbp.gov/trade/basic-import-export/importing-car
http://www.motortrend.com/news/toyota-cheaper-ship-camrys-japan-make-u-s/
http://www.tis-gdv.de/tis_e/ware/stahl/tafeln/tafeln.htm
http://www.tis-gdv.de/tis_e/ware/kfz/pkw/pkw.htm
WONDER BREAD
MEET THE TEAM
? Keith Leavell
? Brad Turner
? Trip Tastic
? Chelsea Bullington
? Austin Dukes
THE PROCESS
? Suppliers & Customers
? Production
? Packaging
? Mode of Transportation
? Distribution
? Crossing a Border
? Elements of Transportation
? Customs Forms
Supply Chain Mapping
Tier 1
Tier 2
Tier 2
Tier 1
Walmart
Mom
agriculture
Yeast
WONDER BREAD
Winn-dixie
chemicals
Additives
Grandma
Preservatives
Publix
Production

Production Cont.
? The ingredients of traditional bread are flour,
water, and starter
-Other ingredients, such as herbs, seeds, and
flavorings, can be added to create different flavors
? The ingredients are then mixed, kneaded, allowed
to rise for anywhere from 6-24 hours
? The bread is baked often on the hearth of a brick
oven.
Production Cont.
? Production of Wonder Bread is a nearly fully
mechanized process.
? Ingredients are mixed by machine in 2500 lb batches,
separated into loaf pans by machine, allowed to
proof, or rise, in controlled proofing machines, and
baked in an automatic oven with 29 mechanized heat
zones.
? This production process generates 180 loaves each
minute or 35 million loaves every week.
Packaging
? Since 1921, Wonder Bread has
been appealing to the kid in all of
us
? The bubble graphics are now
ingrained in the consumers’
memories
? The overall clean and
contemporary look brings
Wonder Bread forward to today
in a highly recognizable way
Packaging Cont.
? Packaging comes in multiple
colors and varieties depending on
the type of bread
? Packaging is made kid friendly to
help make sandwiches.
? The packaging is intentionally
colorful to catch the childs eye in
the supermarket
Packaging Cont.
? Products include hot dog buns and hamburger
buns, along with a variety of different types of
bread
? Wonder bread packages and displays their
bread horizontally.
-A horizontal display allows a company to
accommodate more slices of bread in the
packaging without the concern of the loaf
falling over.
Packing Cont.
? Throughout the company’s history, one of the most
important innovations in the packaging design is the
adoption of transparent material.
– With the new design, the consumer is able to see the
bread and check the softness and the freshness, i.e. she
is more confident in buying it. (see figures 1 & 2)
Packing Cont.
Modes of Transportation
Two main paths of travel for
transporting Wonder Bread:
? Rail- The product is transported by
container from Point A to Point B
? Road- The product is transported
through vehicle from Point A to
Point B
Modes of Transportation Cont.
Main source of transportation:
Trucking
? The bread is loaded onto pack trucks
or vans
? The driver in most cases is in charge of
unloading the bread
? The store clerks are then in charge of
the placement and display of the
bread
Distribution
? 600+ Distribution Centers
? Bread is one of the world’s toughest distribution
challenges.
– while other supply chains think in terms of weeks
and months, Wonder Bread has to think in terms
of hours and minutes.
? large reverse logistics required
– usually sold to major supermarkets on a buy or
return basis
– sold on crates that stack on dollies which require
return to the bakery
Distribution Cont.
?
There are 17 Wonder Bread factories scattered
across America, from Maine to Alaska.
Crossing a Border
? Produced in 3 countries, Canada (Weston Bakeries), America (Flowers
Foods), and Mexico (Grupo Bimbo)
? NAFTA
? FDA regulations
Terminals
?
Terminals include where the bread is loaded onto the
trucks. Distribution centers
People
?
?
?
?
?
?
Factory Workers
Managers
Drivers
Operators
Sales People
Repairman
Information Systems
Radio frequency ID
ELD
Dispatching
Temp control
Motive Power
Van or truck engine
Trailer for trucking is Vehicle or Container
Customs Forms
BOL–https://www.shipnorthamerica.com/htmfiles/docf
iles/SNA_VicsBOL.pdf
Supplement to BOL–https://www.shipnorthamerica.com/htmfiles/docf
iles/VicsSupplementPage.pdf
Canada Customs Shipping Form–https://www.shipnorthamerica.com/htmfiles/docf
iles/CanadaCustomsInvoice.pdf
NAFTA Certificate of Origin–https://www.shipnorthamerica.com/htmfiles/docf
iles/FILL_US_CofO_Form434.pdf
Bananas
Team Members
?
?
?
?
?
Abreona Nixon
Michael Baffa
Jasmine Richburg
Yhana Burbel
Danica Burnett
Introduction to the Supply Chain of Bananas
From Peru to Philadelphia
?
?
?
Second most consumed fruit in North America
One-third of produce spoils before delivery
148.4 million bananas exported around the world annually
Introduction to the Supply Chain of Bananas
From Peru to Philadelphia
Path
Peru
Port of Philadelphia Via Panama Canal
DCs
Customers
Transportation Justification
Why a ship?
?
Ease of movement
?
Large lots moved
?
Remote Container Management (RCM) tech that allows the company to track data
such as location, power status, temperature, humidity and ventilation settings,
even while at sea
Threats to the Freight
?
Port Delays
?
Short life cycle
?
Miscommunications
?
Regulations
Documentation
Bill of Lading
Issued by carrier to acknowledge receipt of
cargo
Certificate of Origin
Completed by the exporter attesting goods
were produced in a particular country
Packing List
Details contents, dimensions, and weight of
a package or container
Commercial Invoice
Describes sold goods and amount due on
the customer (main document for customs
duties)
Documentation (Cont)
Documentation (Cont)
The Plant

Bananas are actually berries

The banana plant is the largest herbaceous flowering plant

Bananas grow year-round

Bananas are the world’s most exported fruit
Harvest and Packaging
Storage Requirements
? Transported for 3-4 weeks at 55 degrees
? Between 60-70 degrees bananas start to ripen
? Bananas need to ripen a few days before final sale
Once they arrive in the U.S.
Conclusion
References
https://www.slideshare.net/mobile/JUNEJO-123/world-history-of-banana
https://www.nationalgeographic.com/environment/urban-expeditions/food/food-journeysgraphic/

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