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Transportation in business

Since ancient times, trading and doing business have been popular among people. But today, trade is divided into four categories: domestic trade, export trade, import trade, and international trade.

  • Domestic Trade: In this type of trade, the product is produced inside a country and sold inside the same country, and the customers of that product are also in the country.
  • Export Trade: In this type of trade, the product is produced inside the country but sold to customers outside the country.
  • Import Trade: It is a trade in which the product is produced abroad but imported and sold inside the country.
  • International trade: In this type of trade, the product is produced abroad and sold abroad, and there are only traders in our country.

In fact, no matter what type the trade is, transportation has always been an important part of it. To put it another way, transportation plays an essential role in any type of trade. Before we discuss the types of transportation methods in trade, it is good to know what international transportation is? In international trade, a commodity may cross the borders of several countries to reach its destination. What is the difference between carrier and forwarder? Hence, transportation in international trade refers to how a commodity starts moving from its origin and reaches its intended destination. Therefore, a series of rules and requirements that are common in international trade and transportation must be followed by the buyer and seller. But in domestic transportation, the trader should consider only a series of internal standards and procedures. What is essential in international transportation and should be paid attention to are these items: Packing methods, different transportation methods, and international rules such as Incoterms. The cargo may be goods, parcels, letters, or any other item in international transportation. Exporters and international traders or importers must have sufficient knowledge of international laws, foreign trade terms, customary procedures, and other points. A commodity is transported in different ways, for example, road, air, rail, and sea transportation. Each of these methods has advantages and disadvantages that traders and exporters should pay attention to. In this article, while defining each of these methods, we discuss the advantages and disadvantages of transportation methods. It is better to know that there are usually two conventional methods in international transportation: the carrier method and the forwarder method. These two methods exist in all transportation methods, such as sea, land, air, and rail, and despite their similarities, there are also differences between them that we mention. All kinds of international transportation methods

What is the difference between carrier and forwarder?

Carrier and forwarders are two types of international goods transport companies through which business people and traders usually export their goods. Of course, remember that the carrier and forwarder may be a natural or legal person. A company that undertakes to deliver the cargo to its destination by signing a contract with the sender or exporter is called a carrier company. Also, carrier companies are usually the owners of the means of transportation themselves, or they have rented it. Carrier companies operate in the fields of air, rail, sea, and other methods of transportation, and for this reason, their range of services and, of course, their responsibility is more than that of forwarding companies. Also, these companies supervise the various stages of transporting goods, stages such as:

  • Loading.
  • Delivering the goods to the recipient at the destination.
  • Carrying out customs procedures.
  • Some other cases.

Maritime Transportation; Its advantages and disadvantages

All kinds of international transportation methods

Forwarding companies are legal or even real entities that receive a certain amount from the sender or exporter of goods and, in return, provide the conditions for sending the desired goods. In fact, the forwarder is a kind of intermediary. An intermediary whose one side is the exporter of the good and the other side is the transport and freight companies. In this method, the forwarder is usually not responsible for carrying the cargo; therefore, the risk will be higher than in the carrier method. Although often the methods of transporting goods this way are cheaper than the previous method. Unlike carrier companies, the forwarder does not own or rent the means of transportation, and transport companies do this through him. air transport; Its advantages and disadvantages The air transport method is considered a completely new method compared to other transportation methods. There are also cargo air terminals in every country, called cargo airports. In each country, there are usually several cargo and export airports. It is also better to know that the air method is less used among the different transportation methods. Here are some of the advantages and disadvantages of this method of transport:

  • The goods will arrive at the destination as soon as possible.
  • Product security against accidents is very high.
  • The cost of the air transport method is high compared to other methods.
  • The possibility of spoilage or damage to the product is minimized.
  • The problems of this method are usually less than other methods.
  • Some goods cannot be shipped by air.

The air transport method is used when you intend to export a perishable product, or for any reason you want your product to reach its destination as soon as possible. Otherwise, it is recommended to use other transportation methods. road transport; Its advantages and disadvantages One of the oldest and most essential methods of transporting goods, which has been shared all over the world for a long time, is road transport, and even now, a significant amount of the world's trade is made in this way. The Silk Road and other communication routes between countries are evidence of the oldness of this method. The road transport method is considered one of the most common. Trucks are the primary means of transporting goods by road, and road transportation companies are the leading players in this field. Its advantages and disadvantages include the following:

  • Unlike the sea or air method, this method is available to everyone.
  • In the road transport method, there is no need to unload cargo in ports.
  • It is the best way to export goods to short-distanced destinations, especially to neighboring countries.
  • The risk of the road method is higher than the air method, and it is less secure.
  • This method cannot be used for exporting goods to distant countries.
  • Compared to the sea transport method, exporting goods to the destination countries takes less time.
  • The cost of the road method is lower than the air or even sea method.
  • The cost of packaging will be much lower in this method.
  • There is a possibility of some goods spoiling on long routes.
  • It is not possible to export goods in large volumes in this method.

rail transport; Its advantages and disadvantages Another method of land transportation is rail transport, which, despite its similarities with the road method, also has differences. Freight trains are a means of transporting goods by rail. Among the most important advantages and disadvantages of the rail method the following can be mentioned:

  • Accidents in this method are very few and have high security.
  • The shipping cost is lower than air and sometimes sea.
  • Rail transportation is not possible for many countries.
  • It is the best method for transporting some goods such as minerals.
  • Weather conditions do not have much effect on the rail method.
  • Not every product can be exported by rail.

Maritime Transportation; Its advantages and disadvantages

Without exaggeration, we can say that the most significant volume of goods is transported by sea, and it is considered one of the most common methods of international transportation of goods. Half of the earth's surface is covered by seawater and oceans, and almost most countries have access to open waters and seas. The following are the most important advantages and disadvantages of sea transportation:

  • Unlike other methods, exporting via sea is done to all countries worldwide.
  • Compared to the land method, it is the best method for long distances.
  • It takes a long time for the goods to arrive in the destination country.
  • It is usually less expensive than the air method.
  • In the sea method, all kinds of goods in different sizes and scales can be exported.
  • Risks and natural accidents are usually more in this method.

In addition to the above methods, other methods can be mentioned in this regard; among them, the mixed way can be said, which is a combination of the mentioned methods.

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