Despite the changes in technology that have rendered some aspects of transport meaningless, this remains to be a lucrative area whose services will always stand the taste of time. Technology has simply come in to boost the transport and logistics industry by making it easier to monitor and track products on transit.
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However, with each development, there are usually many issues arising especially considering the number of middlemen that have to be involved. Gone are days when transport was all about the driver and goods. Many more stakeholders are currently involved in the industry, which is making the delivery of goods complicated and expensive.
The most affected individuals in the industry are entrepreneurs who many times end up spending more than they bargained for. A client who is desperate to have their goods delivered will pay for what has been bargained for prior to the delivery of the services.
However, the entrepreneurs who may incur other untold expenses such as rising fuel costs, security issues, more middlemen than they estimated and other delays may not be able to renegotiate the price. It has become quite a big challenge to tell how much an entrepreneur will spend and sometimes relying on wrong estimates.
Since an entrepreneur has to prove his or her expertise to the client, he or she has to be specific with the price which at times turns out more costly to them (Bowersox, 2000). Previously, entrepreneurs would resort to bargaining the price after the transportation has been done and the goods almost delivered.
However, some of them encountered clients who were not willing to pay for the transport cost especially when they realized that the worth of the goods transported was lesser or almost equal to its cost. They hence resort to abscond from the deal, leaving the entrepreneur with the goods they did not need as well as having to bear the costs they used for transportation.
Contract basis, where the cost was paid in stages was also common but yet faced similar challenges as the total cost is predetermined before the work is done. Considering the above challenges that have continued to face the transport and logistics management industry, it would be appropriate if the costs are split and shared amongst various stakeholders.
For instance, the client should take the initiative of insuring the goods against untold risks. Fuel costs should also be calculated separately basing on the mileage and the market cost while the goods are on transit. The entrepreneur should also partner with specific service providers who should give the correct estimates of doing other logistic activities such as monitoring and handling of the products.
To minimize on cases where goods transported are of lesser worth than the transportation cost, the client needs to be open on the value of goods being transported. Agreements need to be made and clear statements produced to ensure adjustments are made to the initial agreed cost in case it escalates (Ellram, 1996).
Lack of proper guidelines and laws to protect the transport and logistics industry has remained to be a major hindrance to the issue. There is also the issue of technology which keeps changing by day. Even though such developments boost the industry, its challenges are numerous and unpredictable.
Security measures that have always been taken to solve the problem are usually faced with other sophisticated criminal activities that take time to master and solve. This is hence a challenge that the transport and logistics industry will have to live with. However, with proper management, its negative impacts can be reduced drastically.
Bowersox, D. J. (2000). Logistical management. Tata McGraw-Hill Education.
Ellram, L. M. (1996). The use of the case study method in logistics research. Journal of Business Logistics.