Transportation & Distribution Flashcards

Which document serves as a contract of carriage, a receipt for goods, and a document of title in ocean shipping?

Answer: Bill of lading

A bill of lading serves three functions: it is a receipt for cargo, a contract between shipper and carrier, and (if negotiable) a document of title.

Hub-and-spoke distribution networks are most advantageous when:

Answer: Consolidating freight from many origins to many destinations improves load factors

Hub-and-spoke networks improve load utilization by consolidating shipments at central hubs before redistribution, lowering per-unit transport cost.

A carrier's tariff rate is $2.50 per cwt. A shipment weighs 4,000 lbs. What is the freight charge?

Answer: $100

4,000 lbs ÷ 100 = 40 cwt × $2.50 = $100.00 total freight charge.

Which transportation mode is typically most suitable for time-sensitive, high-value, low-weight shipments?

Answer: Air freight

Air freight offers the fastest transit times and is most cost-effective for high-value, low-weight cargo where speed justifies the premium.

A 3PL provider is best defined as:

Answer: An external firm that manages one or more logistics functions on behalf of a shipper

A third-party logistics (3PL) provider is an external company that manages logistics services such as warehousing, transportation, or fulfillment for shippers.

Freight brokers differ from freight forwarders in that brokers:

Answer: Arrange transportation between shippers and carriers without taking possession of goods

Freight brokers are intermediaries who connect shippers with carriers but do not take possession of cargo or issue their own bill of lading.

Which metric measures the percentage of orders delivered on time and in full without damage?

Answer: Perfect Order Rate

Perfect Order Rate combines on-time delivery, complete quantity, no damage, and accurate documentation into a single composite KPI.