Logistics & Distribution Flashcards

Which distribution strategy places inventory at a single central location and ships directly to end customers?

Answer: Centralized distribution

Centralized distribution consolidates inventory at one hub, reducing carrying costs while increasing outbound freight.

In logistics, 'last-mile delivery' refers to which segment of the supply chain?

Answer: Distribution center to final destination

Last-mile delivery covers the final leg from a distribution point to the end customer and is often the costliest per unit.

A company ships 1,000 units monthly with a fixed freight cost of $500 and a variable cost of $0.20/unit. What is the total logistics cost?

Answer: $700

Total cost = $500 fixed + (1,000 × $0.20) variable = $700.

Which mode of transportation offers the lowest cost per ton-mile for bulk commodities over long distances?

Answer: Rail

Rail transport provides the lowest cost per ton-mile for heavy, non-time-sensitive bulk commodities.

What is the primary purpose of a bill of lading in logistics?

Answer: To serve as a contract and receipt for goods in transit

A bill of lading is a legal document between shipper and carrier that serves as a shipment receipt, contract of carriage, and title document.

Which concept describes sharing transportation capacity between multiple shippers to reduce cost?

Answer: Less-than-truckload (LTL)

LTL consolidates shipments from multiple shippers into one trailer, reducing per-shipper transportation cost.

A distribution network with multiple regional warehouses close to customers is best described as:

Answer: Decentralized distribution

Decentralized distribution positions inventory in multiple regional nodes near customers to reduce delivery lead time.