Supply Chain Management Logistics 2 — Questions and Answers
Question 1: Which logistics strategy involves positioning inventory closer to customers to reduce delivery lead times?
- Centralized warehousing
- Forward deployment (Correct answer)
- Cross-docking
- Drop shipping
Correct answer: Forward deployment
Forward deployment places inventory in regional distribution centers or fulfillment hubs near end customers to shorten last-mile delivery time.
Question 2: What does the term 'dwell time' refer to in freight logistics?
- Time a shipment spends in customs
- Time cargo sits idle at a port or terminal (Correct answer)
- Transit time between two distribution centers
- Time to unload a full truckload
Correct answer: Time cargo sits idle at a port or terminal
Dwell time is the period cargo remains at a port, rail yard, or terminal without moving, which increases costs and reduces asset utilization.
Question 3: A company ships products using a mix of ocean freight and rail inland. This is an example of what logistics mode?
- Piggyback transport
- Intermodal transportation (Correct answer)
- Relay logistics
- Hub-and-spoke routing
Correct answer: Intermodal transportation
Intermodal transportation uses two or more transport modes (e.g., ocean + rail) with cargo in the same container throughout the journey.
Question 4: Which KPI measures the percentage of orders delivered on time and in full without any defects?
- Fill rate
- On-time delivery (OTD)
- Perfect order rate (Correct answer)
- Order cycle time
Correct answer: Perfect order rate
Perfect order rate combines on-time delivery, complete shipment, correct documentation, and damage-free delivery into one composite metric.
Question 5: In transportation management, what is a 'dead head' mile?
- Miles driven over the speed limit
- Miles driven with an empty trailer (Correct answer)
- Miles added due to a detour
- Miles covered by a subcontractor
Correct answer: Miles driven with an empty trailer
Dead head (or empty) miles occur when a truck travels without cargo, reducing carrier profitability and increasing cost per loaded mile.
Question 6: Which document serves as a contract of carriage, a receipt of goods, and a document of title in ocean shipping?
- Commercial invoice
- Certificate of origin
- Bill of lading (Correct answer)
- Packing list
Correct answer: Bill of lading
A bill of lading fulfills three functions: it is the carrier's receipt for cargo, the contract of carriage terms, and (if negotiable) a document of title.
Question 7: A retailer uses a logistics model where the supplier ships directly to the end customer on the retailer's behalf. What is this model called?
- Cross-docking
- Vendor-managed inventory
- Drop shipping (Correct answer)
- Postponement
Correct answer: Drop shipping
Drop shipping allows a retailer to sell products without holding inventory; the supplier fulfills and ships orders directly to the customer.
Supply Chain Management Logistics 2
Which logistics strategy involves positioning inventory closer to customers to reduce delivery lead times?