SAMPLE QUESTION PAPER 750

Subject: Transportation Systems and Logistic Management

Paper: Logistics Operations and Supply Chain Management I
Year: 2013 14
Time: 2 Hrs
Marks: 60

1. Weightage to Objectives:
Objectives K U A S Total
Percentage of Marks 30% 30% 30% 10% 100%
Marks 18 18 18 6 60

2. Weightage to form Questions:

Type of Questions EA SA VSA O Total
Number of Questions 2 (each 7) 5 (each 4) 8 (each 2) 10 (each 1)
Marks Allotted 14 20 16 10 60
Estimated Time 30 40 30 10 120*
* 10 minutes for paper reading

3. Weightage to Content Marks

Half-yearly Examination
1. Unit 1 23
2. Unit 2 23
3. Unit 3 up to Fright Management Costs 14

4. Scheme of Sections:

Section Type of Questions Choice Number of questions

A EQ Internal Choice (Either or Type) 4

B SQ 5 out of 8 8
C VSQ 8 out of 11 11
D OQ 10 (no choice) 10

1. Difficulty Level:

Difficult 10% of Marks

Average 50% of Marks
Easy 40% of Marks

Abbreviations Used:

K Knowledge U Understanding A Application S Skill

EA/EQ Essay Answer/Question SA/SQ Short Answer/Question

VSA/VSQ Very Short Answer/Question O/OQ Objective /Objective Question

LOGISTICS OPERATIONS AND SUPPLY CHAIN MANAGEMENT I

Code:
Class XI (Theory)

Time Allowed: 2 Hours Max Marks: 60

Blue Print Half yearly Examination

Objective Very Short

Short Essay Total
Form of Questions Marks Marks Marks Marks Marks
1 2 4 7
Unit- 1
Elements of Logistics
Operations and Supply
Chain Management 3 5* 2* 2* 23
Unit II
Multimodal Transport
System 3 4* 2* 2* 23
Unit III (Partial)
Up to Freight Management
Costs only 4 2* 4* ----- 14
TOTAL 10 (1) 8 (2) 5 (4) 2 (7) 60
* including choice questions

MODEL QUESTION PAPER

Half- Yearly Examination : : Class XI

LOGISTICS OPERATIONS AND SUPPLY CHAIN MANAGEMENT I

Time: 2 Hrs Answer All Sections Max. Marks: 60

SECTION A (Essay Questions) 2 x 7 = 14 marks

Answer the following Questions in 40 lines

1. What is logistics? State with examples from real life and explain the functions of
logistics with the help of those examples.
(OR)
2. Explain concept of warehouse and examine its functions.
 3. What is a multimodal transport system? Explain its advantages.
(OR)
4. Describe the intermodal relationships in multimodal transport system.

SECTION B (Short Questions) 5 x 4 = 20 marks

Answer any Five Questions in 20 lines

5. Explain various types of Warehouses.

6. Distinguish between Inbound and Outbound Logistics.
7. Raw teakwood is to be exported from Malaysia to India in bulk. Which mode of
transport would you recommend? What are the advantages and disadvantages of such
a mode?
8. Discuss the importance of International movements in Indian economy.
9. Develop a net work route connecting at least 8 nodes with hypothetical time between
various nodes and find out the shortest route
10. What is the need for route management in transportation?
11. What are the basic costs in transportation? Explain.
12. Consider any mode of transportation of your choice and apply hub-spoke model.

SECTION C (Very Short Questions) 8 x 2 = 16 marks

Answer any Eight Questions in 6 lines

13. Develop a supply chain considering any product of your choice.

14. Explain any three principles of good routing system.
15. Examine the features of multimodal transport system.
16. Discuss about any two types of intermodal movements.
17. What are the market related factors that influence transport costs?
18. Distinguish between private and public warehouses.
19. The following are monthly costs incurred by Transport Company. Identify the basic
costs of transportation.
Rent of container Rs. 1,20,00,000, Rent of office Rs. 27,500, Diesel cost Rs. 80,000,
Driver salary Rs. 15,000, Cleaner salary 5,000, Vehicle repairs Rs. 45,000, Loading
and unloading costs Rs. 25,000
20. Indian Oil Company wish supply LP gas to its customers for cooking purpose at
cheaper rate by minimizing its transport costs? What is best means of transport?
21. Examine the need for inventory management.
22. Describe the components of supply chain management.
23. Explain the impact of cold chain, considering geographical perspective.

SECTION D (Objective Questions) 10 x 1 = 10 marks

Identify the TRUE/FALSE from the following statements and put T if it is true and F if
it isFalse in the braces.
 24. Raw material inventories are indirect inventories. ( )
25. Airlines are variable cost carriers. ( )
26. Pipe-lines are variable cost carriers. ( )
27. Intermodal transport system maximises costs and minimises revenue. ( )
28. Alliance of international industries increase in working costs. ( )
29. Balancing inventory reconciles supply availability with demand. ( )

Match the following left hand side words with appropriate words from right hand side
and appropriate alphabet in the braces

30. Stow away (a) Incorporates weight and space considerations ( )

31. Density (b) Cost which does not change with the services or volume ( )
32. Variable cost (c) product dimensions and impact of the same on vehicle space
utilization ( )
33. Fixed cost (d) cost which changes with the services or volume ( )

Answers:

Section A

Q.1 Logistics was defined by Greeks as the Science of correct measures by

mathematics. Logistics is the management of the flow of resources between the point
of origin and the point of destination in order to meet some requirements, for
example, customers or corporations. The resources managed in logistics can include
physical items such as food, materials, equipment, liquids, and staff, as well as
abstract items such as information, particles and energy. The term logistics comes
from the late 19th century: from French logistique, from loger 'to lodge'. Logistics is
considered to have originated in the military's need to supply itself with arms,
ammunition, and rations as it moved from a base to a forward position. In the
ancient Greek, Roman, and Byzantine Empires, military officers with the
title Logistikas were responsible for financial and supply distribution matters.

Logistic Functions:
Business logistics is a series of separate activities or functions which all fall under a
business firm's logistics umbrella they are as follows:
i. Supply:
Consider the supply of materials that you have as this would help meet your self-
imposed quota for the company to profit.
ii. Transportation:
This is where logistics management applies. A company should have the
transportation services needed to move the products and deliver them in a timely and
efficient manner to the customers.
iii. Facilities:
Different companies employ different services according to their needs. Each of them
has a different facility which helps produce the products and services which they
eventually offer to customers. These facilities should be tailor-made and fit the client's
and customer's specifications.
iv. Services:
From customer service to delivering an order on time, to resolving order-related
problems, a company should employ a logistics management service provider which
will provide all of these services.
iv. Management and Administration:
This is an aspect of logistics management which is common to all organizations. A
well balanced and knowledgeable staff and leaders make for a better service-oriented
company. In relation to this, here are the important factors that you should consider
when employing a logistics management service provider that will best benefit your
company.
vi. Inbound Transportation:
You should choose a logistics management service provider who will give out quotes
for the inbound transportation costs of components. This might include the delivery of
individual components to your production line. For a better price comparison, you
may also ask if they can deal with clients who buy some or all of their components
from a particular supplier. You can look for cost and time frame quotations that you
can use to consider the service provider that is most cost-effective
vii. Outbound Transportation:
Outbound transportation refers to the carriers which meet the customer's needs.
Different clients need various freight and carrier services and a logistics management
service provider should be able to provide these individual needs. The deal can either
be on an over-all operational basis, or on a per-shipment basis. This provides a
comprehensive solution for a company's primary need for logistics. Choose a logistics
management service provider, who will provide rate comparisons from different
couriers to meet and handle the customer's goals. The main point here is that you need
to have somebody to handle and ship out your main products in a safe and timely
manner.
viii. Troubleshooting Capabilities:
A logistics management service provider should know how to handle unusual and
day-to-day complications and problems. If a customer has a specific shipping need,
would they be able to deliver and solve the problem? Should a serious delivery or
shipping problem arise, they should be able to troubleshoot and come up with the
perfect solution and at the same time soothe a customer's ruffled feathers.
ix. Keeping Customers Informed:
The customers have the right to know the details about a particular order shipment.
They should be informed of when the products were shipped, how it was shipped and
who shipped it. Some logistics management service provider gives out their contact
numbers directly to their client's customers. This would avoid a pointing of fingers
should problems arise. Also, there is online tracking information available for most
couriers and carriers. All in all, you have to choose a logistics management service
provider that would fit your company's needs so that both of you will reap the benefits
in the end. Logistics has developed from a series of separate activities largely based
on transport, warehousing and procurement, where decisions were seen as largely
operational or tactical. As it evolved into a single function, the strategic impact of
logistics has become more evident.
x. Customer Satisfaction:
Logistics plays an extremely important role in ensuring that customers get the right
products at the right place at the right time. Transportation, warehousing, forecasting,
inventory control and production planning all have a direct impact on customer
satisfaction.
 1. Figure: 1.2 Functions of logistics

Q. 2. Concept of Warehouse:
We need different types of goods in our day-to-day life. We may buy some of these
items in bulk and store them in our house. Similarly, businessmen also need a variety
of goods for their use. Some of them may not be available all the time. But, they need
those items throughout the year without any break. Take the example of a sugar
factory. It needs sugarcane as raw material for production of sugar. We know that
sugarcane is produced during a particular period of the year. Since, sugar production
takes place throughout the year, there is a need to supply sugarcane continuously. But
how is it possible? Here storage of sugarcane in sufficient quantity is required. Again,
after production of sugar it requires some time for sale or distribution. Thus, the need
for storage arises both for raw material as well as for finished products. Storage
involves proper arrangement for preserving goods from the time of their production or
purchase till the actual use. When this storage is done on a large scale and in a
specified manner it is called warehousing. The place where goods are kept is called
warehouse. The person in-charge of warehouse is called warehouse-keeper.
Warehousing is defined as the storage of goods: raw materials, semi-finished goods,
or finished goods. This includes a wide spectrum of facilities and locations that
provide warehousing. Since, this is a point in the logistics system where goods are
held for varying amounts of time, the flow is interrupted or stopped, thereby creating
additional costs to the product.
In a macroeconomic sense, warehousing creates time utility for raw materials,
industrial goods and finished products. It also increases the utility of goods by
broadening their time availability to prospective customers.
Warehousing refers to the activities involving storage of goods on a large-scale in a
systematic and orderly manner and making them available conveniently when needed.
In other words, warehousing means holding or preserving goods in huge quantities
from the time of their purchase or production till their actual use or sale. Warehousing
is one of the important auxiliaries to trade. It creates time utility by bridging the time
gap between production and consumption of goods.
Functions of warehouse:
The functions of the warehouse are (i) Receiving (ii) Inspection (iii) Repacking (iv)
Put away (v) Storage (vi) Order Picking/Selection (vii) Sortation (viii) Packing and
shipping (ix) Cross-docking (x) Replenishing
i. Receiving: This includes the physical unloading of incoming transport, checking,
recording of receipts and deciding where the received goods are to be put away in the
warehouse. It can also include such activities as unpacking and repackaging, quality
control checks and temporary quarantine storage for goods awaiting clearance by
quality control.
ii. Inspection: Quality and quantity check of the incoming goods for their required
characteristics.
iii. Repackaging: Incoming lot may be having non-standard packaging, which may
not be stored as it is in the respective location. In those cases these materials have to
be pre packed in unit loads/pallet loads suitable for storage.
iv. Put away: Binning and storing the goods in their respective locations including
the temporary locations from the receiving docking area.
v. Storage: Binning the approved material in their respective locations.
vi. Order Picking/Selection: Goods are selected from order picking stock inthe
required quantities and at the required time to meet customer orders. Picking often
involves break bulk operations when goods are received from suppliers say whole
pallet quantities, but ordered by customers in less than pallet quantity. Order picking
is important for achieving high levels of customer service; it traditionally also takes a
high proportion of the total warehouse staff complement and is expensive. The good
design and management of picking systems and operations are consequently vital to
effective warehouse performance
vii. Sortation: This enables goods coming into a warehouse to be sorted into specific
customer orders immediately on arrival. The goods then go directly to order collation.
vii. Packing and shipping: Picked goods as per the customer order are consolidated
and packed according to customer order requirement. It is shipped according to
customer orders and respective destinations.
viii. Cross-docking: Move products directly from receiving to the shipping dock
these products are not at all stored in the specific locations.
ix. Replenishing: This is the movement of goods in larger order quantities, for
example a whole pallet at a time, from reserve storage to order picking to ensure that
 order picking locations do not become empty. Maintaining stock availability for
order picking is important for achieving high levels of order fill.
Q.3 Multimodal Transport system:

Multimodal transport system is an international through-transport combination with

various combinations of modes. The modes may be related to transport vehicles or
service operators. The modes of transport may be such as ship, rail, truck, aero plane,
car, tram etc. The service modes may be such as public/private operating agencies.
Thus, multimodal transport system relates to a single trip consisting of combination of
modes between which the consignment has to make a transfer. The transportation of
consignment from the origin i.e., shippers door to the destination i.e., consignees
door will be taken up by a single contract. The Contractor manages and co-ordinates
the total task and ensures responsibility for safe custody of consignment. The system
also ensures continuous movement of the goods along the best route by the most
efficient and cost-effective means. The system also involves simplified
documentation. Further, the term Intermodal transport is also used synonymously
with multimodal transport and thus, used in the context of movement of goods from
origin to destination. These two terms have very similar meanings, i.e. the
transportation of goods by more than one mode of transport and a through freight rate.

Figure display multimodal transport system with several modes of transport.

Walk Truck Service Air service Truck Service Train Service Walk
H - - - - -A B C D E F----

Thus, a consignment stocked at warehouse say H carried manually by walk to truck

located at A. The same is loaded on a truck and reaches airport say B. The
consignment will be shifted in to flight at B and reaches airport C. On arrival at C, it
will be transferred in to truck and reaches railway station D. Thereafter, the
consignment will be moved to E by train. Having unloaded at E, it reaches the
destination F through manual carrying.
The following Figure display multimodal transport with different agencies. Thus, the
consignment is booked through private truck from A to B, thereafter moved through
 flight from B to C. At C, the consignment is moved on private truck to D and finally,
it travelled through D to E on train.
Private Public Private Public
Walk Truck Service Air Service Truck Service Train Service Walk
H- - - - -A B C D E ----- F

Advantages of Multimodal Transport System: The following are

advantages of multimodal transport system.
1. Minimizes Time Loss:
As multimodal transport system is planned and coordinated as a single operation, it
`minimises the loss of time and the risk of loss and damage to consignment or goods
at trans-shipment points.
2. Ensures Smooth and Safe Transport:

Multimodal transport operator not only maintains his own communication links, but
also coordinates interchange and onward carriage smoothly at different trans-
shipment points.
3. Provides Faster Transport Service:

Multimodal transport system provides faster transport of goods. It reduces

the disadvantages of distance from markets and the tying-up of capital.
4. Saves Transport Costs:
Multimodal transport system helps in the reduction of transport costs as
single operator completes the entire job of transhipment of goods. Further, the system
also helps in the reduction of cargo insurance costs.
5. Improves International Price Competitiveness:
As multimodal transport system helps in the reduction of transport costs, it will in turn
result in reduced export costs and thereby improves international
price competitiveness.
6. Reduces Burden of Documentation and Formalities:
In case of traditional transport system i.e., segmented transport system there
arises multiple documentation and other formalities at various stages.
However, multimodal transport system reduces the burden of multiple documentation
and other formalities as single operator completes the entire job of transshipment of
goods.
7. Establishes Unique Agency to deal with:
 Unlike segmented transport system, multimodal transport system establishes unique
agency to deal with the entire job of transportation. Thus, the consigner deals
with only one operator relating to transport, insurance, loss and damage of goods.
Q.4 Intermodal relationships:
Intermodal transport system considers not only various modes of transport, but also
involves different operators. All this has become essential, so as to gain
competitiveness and to fulfil consignees requirements on costs and quality of the
transports. Moreover, the intermodal transport system also calls for sharing of
information systems. Thus, intermodal transport system is said to be an integrated
system of transport operations, so as to create an efficient and responsive transport
service throughout the international transport chain. There exists interrelationship
between five parties which affect the transportation system. They are
1. The Shipper (Sending party or originating party)
2. The Consignee (Receiving party or Destination party)
3. The Carrier
4. The Government
5. The Public
There exists interrelationship among the above parties based on their role,
perspectives and ownership aspects. The role and perspectives of each party can be
outlined as follows:
Shippers and Consignees:
The main objective is to transport the goods from origin to desired destination at least
possible cost in a specified time limit.
The transportation service is expected to fulfil the characteristics such as (a) No loss
or damage of goods, (b) Correct invoicing, (c) Predictable transit time, (d) Specified
pickup and delivery times and (e) Accurate transit information.
Carriers:
The important objective is to maximise revenue by minimising costs. The carrier tries
to charge the maximum possible rate acceptable to shipper or consignee by
minimising the operational costs such as labour, fuel and other incidental charges.
In order to achieve the said objectives, the carrier requires flexibility in pickup and
delivery time, so as to consolidate the individual transport needs into bulk economic
transport means.
 Government:
The government contemplates to have a stable and efficient transport system, so as to
achieve rapid economic growth.
The government desires to have an efficient transport system, so as to ensure the
availability of various goods at reasonable price.
The government affects the transport sector through regulation and promotion.
Regulation can be done through controls, while promotion is possible through
incentives.
Public:
Public are more concerned with transport accessibility, efficiency, costs, pollution and
safety measures.
Development of transport system to a large extent depends on demand for goods
arising from public.
Though minimizing transport cost is important goal to consumers, yet trade off
associated with environmental and safety standards also require due consideration.
The above interrelationships can be shown diagrammatically (Figure 2.8)
The intermodal relationships are said to be complex, in view of interaction between
the parties. It leads to often conflicts between parties with micro interests namely
shippers, consignees and carriers as well as with a macro interest parties namely
government and the public. Finally, conflicts have led to duplication, regulation and
restriction of transport services.

PUBLIC

GOVERNMENT

2. SHIPPER CARRIER CONSIGNEE

3.

Intermodal Relationships

SECTION B (Short Questions)

Q. 5 Types of Warehouses:

After getting an idea about the need for warehousing, let us identify the different
types of warehouses. In order to meet their requirement various types of warehouses
came into existence and may be classified as follows:
i. Private Warehouses
ii. Public Warehouses
iii. Government Warehouses
iv. Bonded Warehouses
v. Co-operative Warehouses
i. Private Warehouses: The warehouses, which are owned and managed by the
manufacturers or traders to store, exclusively, their own stock of goods are known as
private warehouses. Generally, these warehouses are constructed by the farmers near
their fields, by wholesalers and retailers near their business centers and by
manufacturers near their factories. The design and the facilities provided therein are
according to the nature of products to be stored.
ii. Public Warehouses: The warehouses which are run to store goods of the general
public are known as public warehouses. Anyone can store his goods in these
warehouses on payment of rent. An individual, a partnership firm or a company may
own these warehouses. To start such warehouses a license from the government is
required. The government also regulates the functions and operations of these
warehouses. Mostly, these warehouses are used by manufacturers, wholesalers,
exporters, importers, government agencies, etc.
iii. Government Warehouses: These warehouses are owned, managed and controlled
by central or state governments or public corporations or local authorities. Both
government and private enterprises may use these warehouses to store their goods.
The Central Warehousing Corporation of India, State Warehousing Corporation and
Food Corporation of India are examples of agencies maintaining government
warehouses.
iv. Bonded Warehouses: These warehouses are owned, managed and controlled by
government as well as private agencies. Private bonded warehouses have to obtain
license from the government. Bonded warehouses are used to store imported goods
for which import duty is to be paid. Incase of imported goods the importers are not
 allowed to take away the goods from the ports till such duty is paid. These
warehouses are generally owned by dock authorities and found near the ports.
v. Co-operative Warehouses: These warehouses are owned, managed and controlled
by co-operative societies. They provide warehousing facilities at the most economical
rates to the members of their society.
Q.6 Inbound Logistics and Outbound Logistics (IBL and OBL):
Logistics manages the flow of inputs from suppliers, the movement of materials
through different operations within the organization and the flow of materials out to
customers. Moving materials into the organisation from suppliers is called inbound or inward
logistics; moving materials out to customers is outbound or outward logistics; moving
materials within the organisation (often described as collecting from internal suppliers and
delivering to internal customers) is materials management.
IBL: Inbound or inward logistics move materials into an organisation from suppliers
OBL: Outbound or outward logistics move materials from an organisation out to
customers

Figure: 1.3 Logistics Operation

The original and most elementary notion of logistics is that of a set of three operational
activities - movement, storage and rearrangement - that add value to goods. The value added
inherent in these activities is based on the following:
Place - Adding place value to items by moving them from locations of lower value for the
customer to locations of higher value to the customer.
Period & Pace - Adding time value to items by storing them and thereby (i) moving items
from periods when they are available (following extraction, harvest, or manufacturing) to
periods when customers require them, and (ii) Making all processes more effective -
inventory allows for de-coupling the processes along the value chain from each other, so they
can each run at their optimal pace according to their own economics.
Pattern - Adding order value to items by arranging them in desired quantities and patterns.
Example includes consolidation, break-bulk, sequencing and picking/packing, etc.

Figure: 1.4 Series of logistics activities

This figure depicts the series of logistics activities associated with the three P-s of
logistics. This series presents the activities from the point of view of a single player in the
channel - a manufacturer. The left most outbound inventory management activity in the
figure however is typically conducted by the vendor of this manufacturer, managing its
inventory of outbound goods, which are inbound material for the manufacturer under study.
Finally, operational logistics includes a set of specialty activities which support the primary
"PPP" activities. These include audit and payment, customs brokerage, order processing,
international documentation, etc.

Q.7 Raw wood which is to be transported in bulk may be transported cheaply through
water carriers as it is the cheap means of transport compared to other modes. Water
transport is the oldest mode of transport. Water transport is generally classified into
three types namely inland water ways (rivers, canals, big lakes), domestic coast ways
and sea ways. Water transport is more suitable for mass movement of bulk shipments
and low value commodities. It is because, water transport cost per tonne per kilometre
is very much low. Thus, water transport is preferred to reduce the costs when speed of
delivery is not important. Water transport is used to transport bulk wood, iron ore,
coal, chemicals, petroleum products etc. Fixed costs relating to water transport are
relatively less compared to rail network, but relatively when compared to motor
carriers.

Advantages:
 1. Suitable for mass movement of bulk shipments.
2. Transport cost per tonne per kilometre is very much low.
Disadvantages:
1. Not suitable for quick transport of goods.
2. If the origin and destination of movement are away from water way, it needs more
handing charges and also requires supplementing with rail or motor trucks.

Q.8 International Movements:

The ability to transport goods safely, quickly and cost-efficiently to markets is

important for international trade, national distributive trades, and economic
development. Needless to emphasize that increased volume of domestic as well as
foreign trade improves the industry, national income and employment opportunities.
Increased incomes and improved employment opportunities in turn not only promote
savings and thereby investment, but also pushup the aggregate demand for goods.
Thus, trade is identified as engine of economic growth. Hence, transportation sector
plays an important role in the promotion of domestic as well as international trade.
As per the available statistics, in 2009, world GDP fell by 2.3%, while in the
European Union GDP fell by 4.2%, and in the United States and Russia GDP dropped
by 2.4% and 7.9% respectively. As a result, world trade volume dropped by 12%.
Thus, the global economic crisis and the collapse of world trade in 2009 had major
impact on the transport sector. As a result, world container traffic dropped by 26%,
while air freight ton-km fell by 10%. The data also indicate that a 23% reduction in
rail T-km and over 21% fall in road T-km in the EU. At the same time, rail data for
the United States and Russia reports a decline of nearly 14% and 12% respectively.
Q.9 Net work route connecting at least 8 nodes with single origin and destination
hypothetical time.

5
2
15 4

5
1 5 20
5

5 3 25
 6
12
7
9
6
10 8

Shortest route is 1 3 6 8 and it consumes 27 hrs.

Q.10 Route Management:

The transportation cost range between one-third and two-third of total logistics costs.
Hence, improving efficiency through the maximum utilization of transportation
equipment and personnel is a major concern. To reduce transportation costs and to
improve customer service, finding the best paths that a vehicle should follow through a
network of roads, rail lines, shipping lanes, or air navigational routes that will minimize
time or distance is a frequent decision problem. In this context, Route Management
concerns the selection of route between origins and destinations in transportation
network. Routes indicate paths taken by trucks, rail, cars, buses, or individuals travelling
from place to place. In route management the basic problem is due to variations in origin
and destination points such as (1) separate and single origin and destination points
(2) multiple origin and destination points.
Q.11 Four Basic Costs in Transportation
Fixed Cost:
Fixed cost is that cost which does not change with the services or volume. Fixed
expenses include administrative cost of taking the transportation order, time to
position the vehicle for loading or unloading, invoicing and equipment cost. These
costs do not vary with the volume of shipment. In transport pricing, the costs that are
constant over the normal operating volume of the carrier are fixed cost. However, in
the long run all costs are variable costs.
Variable Cost:
Variable cost is that cost which changes with the services or volume. If a truck is
driven more miles certain costs increase proportionately. Fuel costs, wages,
maintenance costs, and tire replacement depend on output. Variable costs include
line-haul costs such as fuel and labour, equipment maintenance, handling and pick-up
and delivery. Line-haul transportation rates are based on two important dimensions
such as distance and shipper volume.
 Joint costs:
A joint cost occurs when the production of one product or service requires or offers
the production of another product or service. For example a rail road moves goods
from New York to Los Angeles (LA). It now has engines available in Los Angeles to
provide back-haul service to New York or additional transportation form Los
Angeles. The cost of placing the train in Los Angeles is a joint cost with the New
York to LA run and whatever runs follows it. Fixed and variable costs can also be
joint costs. All modes incur joint costs to some extent.
Common Costs:
Common costs cannot be directly associated with a product or activity. Since this
creates confusion, we normally assign activities percentages of these common costs.
For example, a tractor/trailer traveling from Dallas to Chicago with three shipments
breaks down and requires $5000 in repairs. How much of this repair cost should be
allocated to the three different shipments? Is it based on space used, weight or both?
Thats the problem with common costs! In transportation, common costs are
significant and are found in all modes.
Q.12 Hub and Spoke System:
The Hub and Spoke model is a system which makes transportation much more
efficient by greatly simplifying a network of routes. It is extensively used in
commercial aviation for both passengers and freight and model has also been adopted
in the technology sector.
The Hub-Spoke distribution paradigm is a system of connections arranged like a
chariot wheel, in which all traffic moves along spokes connected to the hub at the
center. This model is commonly used in industry particularly in transport,
telecommunications and freight as well as in distributed computing. Thus, the
principle of the modern intermodal transportation system is a network of
intermodal terminals (including ports) that are mutually interlinked by high
capacity double stack train routes and that serve as points of transfer between
rail and truck modes. The principle of intermodal terminals is also called the
hub and spoke systemterminal is the hub and highway routes to customer
facilities are spokes. The Hub-Spoke system is as shown in the following Diagram.
Delta Airlines pioneered the method in 1955. But, it was made popular by Fed Ex
Express Company in 1970 by using this method to run the airlines. The model is
 named after a bicycle wheel, which has a strong central hub with a series of
connecting spokes. Routing all the traffic through the Hub actually makes the overall
system more efficient.

SECTION C (Very Short Questions)

Q. 13
Q. 14

1. Truck routes should be formed around clusters of stops that are nearest to each other
in order to minimize the inter-stop travel between them.
2. When stops are to be served during different days of the week, the stops should be
segmented into separate routing and scheduling problems for each day of the week.
3. Efficient routes can be developed through building stop clusters around the farthest
stop from the depot and then working back toward the depot.
Q. 15

1. Consignment or goods pass through more than one transport system.

2. Consignment or goods in international trade pass through more than one carrier.
3. Single operator or contractor completes the entire transportation of consignment.
4. Ensures responsibility for safe custody of consignment.
5. It involves simple documentation.
Q. 16
 1. Sea-Truck: This intermodal involves the shipment of goods in containers, which
are transported on trucks to (from) seaports from (to) their points
of origin (destination) for international exports (imports).

Figure: 2.3 Sea Truck/Truck Sea Intermodal

2. Sea-Rail: It involves the shipment of goods in containers on oceangoing

vesselswhich are transported by rail on the surface leg line-haul movement. The
modal transfer process for the exchange of containers between containerships
and railroad flat cars depends on the location of intermodal rail yards.

Figure: 2.4 Sea Rail/Rail Sea Intermodal

Q. 17

The degree of intra-mode and inter-mode competitions

2. The location of markets, i.e. distance to which the goods must be transported
3. The nature and extent of government regulation
4. The balance and imbalance of freight traffic in a market
5. Seasonality of product movement
6. Whether the product is being transported domestically or internationally etc.

Q. 18

Private Warehouses: The warehouses, which are owned and managed by the manufacturers
or traders to store, exclusively, their own stock of goods are known as private warehouses.
Generally, these warehouses are constructed by the farmers near their fields, by wholesalers
and retailers near their business centers and by manufacturers near their factories. The design
and the facilities provided therein are according to the nature of products to be stored.
ii. Public Warehouses: The warehouses which are run to store goods of the general public
are known as public warehouses. Anyone can store his goods in these warehouses on
payment of rent. An individual, a partnership firm or a company may own these warehouses.
To start such warehouses a license from the government is required. The government also
regulates the functions and operations of these warehouses. Mostly, these warehouses are
used by manufacturers, wholesalers, exporters, importers, government agencies, etc.

Q. 19 Fixed Costs are: Rent of Container, Rent of Office,

Variable Costs are: Diesel cost, Driver Salary, Cleaner salary, Vehicle repairs, loading
and unloading costs
Q. 20

LP gas can be transported through pipeline by minimizing transport costs. Pipelines can be
operated throughout the 24 hours and seven days per week without any interruption. The
basic advantage of pipeline transport is, there arises no need of returning the empty
carrier/vehicle. Pipeline incurs higher fixed costs for the purpose of right of way,
construction, requirements of control stations and pumping capacity. However, variable
operating costs are extremely low on account of low amount of labour requirement.
Q. 21

Inventory management involves a retailer seeking to acquire and maintain a proper

merchandise assortment while ordering, shipping, handling and related costs are kept in
check. It also involves systems and processes that identify inventory requirements, set targets,
provide replenishment techniques, report actual and projected inventory status and handle all
functions related to the tracking and management of material. Thus, Inventory management is
primarily about specifying the shape and percentage of stocked goods. It is required at
different locations within a facility or within many locations of a supply network to precede
the regular and planned course of production and stock of materials.
Q.22
In its simplest form, a supply chain is composed of a company and the suppliers and
customers of that company. This is the basic group of participants that creates a simple
supply chain. Extended supply chains contain three additional types of participants. First
there is the suppliers supplier or the ultimate supplier at the beginning of an extended supply
chain. Then there is the customers customer or ultimate customer at the end of an extended
supply chain. Finally, there is a whole category of companies who are service providers to
other companies in the supply chain. These are companies who supply services in logistics,
finance, marketing and information technology.
Q. 23
From a geographical perspective, the cold chain has the following impacts:
Global. Specialization of agricultural functions permitting the transport of
temperature sensitive food products to distant markets. Enables the distribution of
vaccines and other pharmaceutical or biological products from single large facilities.
Regional. Can support the specialization of production and economies of scale in
distribution. This could involve specialized laboratories exchanging temperature
sensitive components or large cold storage facilities servicing regional grocery
markets.
Local. Timely distribution to the final consumer of perishables, namely grocery stores
and restaurants.

SECTION D (Objective Questions)

Q. 24 F
Q. 25 T
Q. 26 F
Q. 27 F
Q. 28 F
Q. 29 T
Q. 30 (b)
Q. 31 (a)
Q. 32 (d)
Q. 33 (c)

SAMPLE QUESTION PAPER

ANNUAL EXAMINATION
Subject: Transportation Systems and Logistic Management
Paper: Logistics Operations and Supply Chain Management I
 Year: 2013 14
Time: 2 Hrs
Marks: 60

4. Weightage to Objectives:
Objectives K U A S Total
Percentage of Marks 30% 30% 30% 10% 100%
Marks 18 18 18 6 60

5. Weightage to form Questions:

Type of Questions EA SA VSA O Total
Number of Questions 2 (each 7) 5 (each 4) 8 (each 2) 10 (each 1)
Marks Allotted 14 20 16 10 60
Estimated Time 30 40 30 10 120*
* 10 minutes for paper reading

6. Weightage to Content Marks

Annual Examination

1.Unit 1 11
2. Unit 2 12
3. Unit 3 13
4. Unit 4 13
5. Unit 5 11

5. Scheme of Sections:

Section Type of Questions Choice Number of questions

A EQ Internal Choice (Either or Type) 4

B SQ 5 out of 8 8
C VSQ 8 out of 11 11
D OQ 10 (no choice) 10

6. Difficulty Level:

Difficult 10% of Marks

Average 50% of Marks
Easy 40% of Marks

Abbreviations Used:

K Knowledge U Understanding A Application S Skill

EA/EQ Essay Answer/Question SA/SQ Short Answer/Question

VSA/VSQ Very Short Answer/Question O/OQ Objective /Objective Question

LOGISTICS OPERATIONS AND SUPPLY CHAIN MANAGEMENT I

Code:
Class XI (Theory)

Time Allowed: 2 Hours Max Marks: 60

Blue Print - Annual Examination

Objective Very Short

Short Essay Total
Form of Questions Marks Marks Marks Marks Marks
1 2 4 7
Unit- 1
Elements of Logistics
Operations and Supply
Chain Management 1 3 1 1* 11
Unit II
Multimodal Transport
System 2 1 2 1* 12
Unit III
Freight Management and
Material Handling 0 2* 2* 1 13
Unit IV
Safety in Transportation
and Traffic Regulation 1 2* 2* 1 13
Unit V
ISO in Logistics and
Occupational Hazards
6 3* 1* 0 11
TOTAL 10 (1) 8 (2) 5 (4) 2 (7) 60
*including choice questions

MODEL QUESTION PAPER

Annual Examination: Class XI

LOGISTICS OPERATIONS AND SUPPLY CHAIN MANAGEMENT I

Time: 2 Hrs Answer All Sections Max. Marks: 60

SECTION A (Essay Questions) 2 x 7 = 14 marks

Answer the following Questions in 40 lines

1. What is supply chain management? Explain the supply chain principles.
(OR)
2. Explain various types of intermodal freight movements.

3. Discuss the Hub and Spoke system with suitable example showing diagrammatically
the system
(OR)
4. Explain various types of railway accidents.

SECTION B (Short Questions) 5 x 4 = 20 marks

Answer any Five Questions in 20 lines

5. Examine any five functions of Warehouses with your own suitable examples?
6. Examine the intermodal relationships in transport.
7. Discuss the advantages of multimodal transport system.
8. Discuss the safety measures to be followed by big shopping malls dealing with a large
variety of goods.
9. Explain the functions of storage system with your own suitable examples.
10. What are the objectives of material handling?
11. Explain about disaster management in railways.
12. What type of hazards do you come across in a Pharma Company?

SECTION C (Very Short Questions) 8 x 2 = 16 marks

Answer any Eight Questions in 6 lines

13. Define the term logistics and explain it with your own examples.
14. Distinguish between fluctuation and anticipation inventories with your own examples.
15. Explain the global and local impact of cold chain.
16. Discuss the advantages and disadvantages of rail network.
17. Examine the need for stacking.
18. Mention any three principles of material handling suitable in a four wheeler
manufacturing Company.
19. Explain any three reasons for road accidents?
20. Point out any two precautions to be taken in the transportation of petroleum products.
21. Examine the need of ISO in logistics.
22. Distinguish between quality control and quality assurance with your own suitable
examples.
23. How do you protect workers against hazards in Iron and steel industry?

SECTION D (Objective Questions) 10 x 1 = 10 marks

Identify the TRUE/FALSE from the following statements and put T if it is true and F if
it is False in the braces.

24. Stacks in pyramid or stepped form on two is a stepped stack ( )

25. Balancing inventory reconciles supply availability with demand. ( )
26. Intermodal transport system involves only single operator. ( )
27. Multimodal transportation system involves multiple documentation. ( )
28. Securing cargo in transit from theft or pilferage is a challenge. ( )

Match the following left hand side words with appropriate words from right hand side
and appropriate alphabet in the braces

29. Chemical hazards (a) Wear ear plugs or ear muffs ( )

30. Noise hazards (b) Corrosive, irritating, toxic, flammable or carcinogenic ( )
31. Vibration hazard (c) occur most commonly in warehouse ( )
32. Thermal stress (d) sufficient cushioning or vibration absorbers on the seats ( )
33. Manual Handling hazards (e) Avoid thick clothing ( )

Answers:

SECTION A (Essay Questions)

Q.1 Supply Chain Management:

The Supply Chain Management Program integrates topics from manufacturing

operations, purchasing, transportation, and physical distribution into a unified program.
Successful supply chain management, then, coordinates and integrates all of these activities
into a seamless process. It embraces and links all of the partners in the chain. In addition to
the departments within the organization, these partners include vendors, carriers, third party
companies, and information systems providers.
Supply chains encompass the companies and the business activities needed to design,
make, deliver, and use a product or service. Businesses depend on their supply chains to
provide them with what they need to survive and thrive. Every business fits into one or more
supply chains and has a role to play in each of them. The pace of change and the uncertainty
about how markets will evolve has made it increasingly important for companies to be aware
of the supply chains, they participate in and to understand the roles that they play. Those
companies that learn how to build and participate in strong supply chains will have a
substantial competitive advantage in their markets.
For instance, a wholesaler acts as a customer, when buying goods from manufacturers
and then as a supplier when selling goods to retailers. A manufacturer buys raw materials
from suppliers, assembles these into finished products and sells them to wholesalers. As a
result, most products move through a series of organisations as they travel between original
suppliers and final customers. Milk moves through a farm, tanker collection, dairy, bottling
plant, distributor and supermarket before we buy it. A tooth brush starts its journey with a
company extracting crude oil and then it passes through pipelines, refineries, chemical works,
plastics companies, manufacturers, importers, wholesalers and retailers before finishing in
your bath room. A sheet of paper moves through a string of organisations before it reaches
your desk. People use different names for these chains of activities and organisations. When
they emphasise the operations, they refer to the process; when they emphasise marketing,
they call it a logistics channel; when they look at the value added, they call it a value chain;
when they see how customer demands are satisfied, they call it a demand chain. Here we are
emphasising the movement of materials and use the most common term of supply chain.
Supply-Chain Principles:
There are seven principles as articulated by Andersen Consulting are as follows:
1. Segment customers based on service needs: Companies traditionally have grouped
customers by industry, product, or trade channel and then provided the same level of service
to everyone within a segment. Effective supply-chain management, by contrast, groups
customers by distinct service needs--regardless of industry--and then tailors services to those
particular segments.
2. Customise the Supply Chain Management network: In designing their Supply Chain
Management network, companies need to focus intensely on the service requirements and
profitability of the customer segments identified. The conventional approach of creating a
"monolithic" Supply Chain Management network runs counter to successful supply-chain
management.
3. Listen to signals of market demand and plan accordingly: Sales and operations
planning must span the entire chain to detect early warning signals of changing demand in
ordering patterns, customer promotions, and so forth. This demand-intensive approach leads
to more consistent forecasts and optimal resource allocation.
4. Differentiate product closer to the customer: Companies today no longer can afford to
stock pile inventory to compensate for possible forecasting errors. Instead, they need to
postpone product differentiation in the manufacturing process closer to actual consumer
demand.
5. Strategically manage the sources of supply: By working closely with their key suppliers
to reduce the overall costs of owning materials and services, supply-chain management
leaders enhance margins both for themselves and their suppliers. Beating multiple suppliers
over the head for the lowest price is out, Andersen advises "Gain sharing" is in.
6. Develop a supply-chain-wide technology strategy: As one of the cornerstones of
successful supply-chain management, information technology must support multiple levels of
decision making. It also should afford a clear view of the flow of products, services, and
information.
7. Adopt channel-spanning performance measures: Excellent supply-chain measurement
systems do more than just monitor internal functions. They adopt measures that apply to
every link in the supply chain. Importantly, these measurement systems embrace both service
and financial metrics such as each account's true profitability.
These principles are not easy to implement, because they run counter to ingrained
functionally oriented thinking about how companies organise, operate, and serve customers.
The organisations that do persevere and build a successful supply chain have proved
convincingly that you can please customers and enjoy growth by doing so.
Q.2 Types of Intermodal Movements:

Intermodal movement of goods or consignments involves the use of two or more

modes of transportation in a closely linked network for the continuous movement of goods.
The following are different types of intermodal freight movements.
1. Sea-Truck: This intermodal involves the shipment of goods in containers, which
are transported on trucks to (from) seaports from (to) their points
of origin (destination) for international exports (imports).

Sea Truck/Truck Sea Intermodal

2. Sea-Rail: It involves the shipment of goods in containers on oceangoing

vesselswhich are transported by rail on the surface leg line-haul movement. The
modal transfer process for the exchange of containers between containerships
and railroad flat cars depends on the location of intermodal rail yards.
 Sea Rail/Rail Sea Intermodal

3. Truck-Rail: This intermodal involves the shipment of trailers on railroad

flatcars, the trailers being transported by trucks between points of origin and
destination and intermodal ramps.

Figure: 2.5 Truck - Rail/ Rail -Truck Intermodal

4. Air-Truck: This intermodal involves the movement of goods in air freight

containers, which are carried on trucks to/from air cargo terminals from/to their
points of origin and destination.

Air Truck/Truck Air Intermodal

5. Barge-Truck: This intermodal involves the movement of goods in containers or

trailers on barges that are transported on trucks for the surface leg of the shipment.
Roll-on/roll-off barge transport is an example of barge-truck intermodal
movement, in which wheeled containers or trailers are transported on barges,
which are loaded and unloaded by the means of ramps, without the use of cranes.
 Barge Truck/Truck Barge Intermodal

Q. 3 Hub and Spoke System:

The Hub and Spoke model is a system which makes transportation much more
efficient by greatly simplifying a network of routes. It is extensively used in commercial
aviation for both passengers and freight and model has also been adopted in the technology
sector.
The Hub-Spoke distribution paradigm is a system of connections arranged like a
chariot wheel, in which all traffic moves along spokes connected to the hub at the center. This
model is commonly used in industry particularly in transport, telecommunications and freight
as well as in distributed computing. Thus, the principle of the modern intermodal
transportation system is a network of intermodal terminals (including ports) that are
mutually interlinked by high capacity double stack train routes and that serve as
points of transfer between rail and truck modes. The principle of intermodal
terminals is also called the hub and spoke systemterminal is the hub and
highway routes to customer facilities are spokes. The Hub-Spoke system is as shown in
the following Diagram 3.6
Delta Airlines pioneered the method in 1955. But, it was made popular by Fed Ex
Express Company in 1970 by using this method to run the airlines. The model is named after
a bicycle wheel, which has a strong central hub with a series of connecting spokes. Routing
all the traffic through the Hub actually makes the overall system more efficient.
 Hub-Spoke System

This model is also applicable to other forms of transportation as follows:

1. Sea transport, where feeder ships transport shipping containers from different ports to
a central container terminal to be loaded onto larger vessel.
2. Cargo airlines; for example most UPS Airlines flights travel through its World port at
Louisville International Airport, and a significant portion of Fed Ex Express parcels
are processed at its Super hub at Memphis International Airport.
3. Freight rail transport, where cargo is hauled to a central exchange terminal. At the
terminal, shipping containers are loaded from one freight car to another and
classification yards are used to sort freight cars into trains and divide them according
to varying destinations.
4. Public transit utilizes various transport hubs to allow passengers to transfer between
different lines or transportation modes.
5. For passengers road transport, the spoke-hub model does not apply because drivers
generally take the shortest or fastest route between two points.
Q. 4 Railway Accidents

Railway accidents are classified as shown here.

Head on collision: It is the collision on a single line railway .It clearly means that at least
one of the trains has passed a signal at danger .Or the signal man has made a major error
.Head on collisions may occur at major junction due to similar reason.
Rear end collision: A rear-end collision is a rail accident wherein a train crashes into
another train in front of it. Usually it is caused by tailgating or sudden stops. This is usually
caused by the errors of the signal man or the carelessness of the driver.

A railroad engineer, is also

called as locomotive engineer,
train operator, train driver or
engine driver

Collision with buffer stops: A buffer stop or bumper is a device to prevent railway
vehicles from going past the end of a physical section of track. The design of the buffer stop
is dependent in part upon the kind of couplings that the railway uses.
Derailment: A derailment is an incident on a railway or tramway in which one or more rail
vehicles leave the tracks on which it is, or they are, travelling.
Errors of the driver & Signal man: Negligence from the part of the engine driver and the
signal man is another classification of accident
Causes of derailment: There are several causes of derailment: 1) broken or misaligned rails,
2) excessive speed (especially on curves),3) faults in the train and its wheels, 4) faults in sets
of points. 5) Derailment as a result of a collision.

Rail breakages

There are many reasons for rail break. Wheel burns occur when high temperatures are
generated if a driven axle rotates with little forward movement. This changes the metallurgy
of a rail, and will easily be broken.
Rail breaks at rail joints
In jointed track, rails are usually connected with bolted fishplates. The web of the rail
experiences large shear forces and this is increased around the bolt hole. This leads to star
cracking from the bolthole. This can lead to a triangular piece of rail at the joint becoming
separated.
Manufacturing defects in rail: For durability manufacturers make harder rail steel. This has
the effect of reducing the rate of surface wear. As a result micro-cracking develops .This
leads to catastrophic fatigue cracking.

Fig 4.12 A Buffer stop Fig.4.13 Derailment

Wheel burn-related rail breaks

Sometimes a locomotive wheel spins without moving the train forward (also known as
slipping). The small section of rail directly under the wheel is heated by the forces of friction
between the wheel and itself. The wheel rests on an area of rail about two centimetres long,
so the heating effect is much localized and occurs very quickly. The heated spot is cooled
down very quickly, resulting in undesirable changes to the steel metallurgy.

4.14 Fishplate bolted joint Fig 4.15 A rail break

Wheel flat-related rail breaks
If the brakes are dragging or the axle stops to move on a rail vehicle while the train is in
motion, the wheel will be dragged along the head of the rail. This causes to develop a 'flat
spot' on the wheel surface where it contacts the rail. When the brakes are subsequently
released, the wheel will continue to roll around with the flat spot, causing a banging noise
with each rotation. This condition is known as a wheel flat. This causes a rail break.
Safety Measures: Improve the railway traffic environment: To ensure safety of railway
traffic, good quality railway tracks and operational safety facilities are needed.
SECTION B (Short Questions)

Q.5 Functions of warehouse:

The functions of the warehouse are (i) Receiving (ii) Inspection (iii) Repacking (iv) Put away
(v) Storage
i. Receiving: This includes the physical unloading of incoming transport, checking, recording
of receipts and deciding where the received goods are to be put away in the warehouse. It can
also include such activities as unpacking and repackaging, quality control checks and
temporary quarantine storage for goods awaiting clearance by quality control.
ii. Inspection: Quality and quantity check of the incoming goods for their required
characteristics.
iii. Repackaging: Incoming lot may be having non-standard packaging, which may not be
stored as it is in the respective location. In those cases these materials have to be pre packed
in unit loads/pallet loads suitable for storage.
iv. Put away: Binning and storing the goods in their respective locations including the
temporary locations from the receiving docking area.
v. Storage: Binning the approved material in their respective locations.
Q. 6 Intermodal relationships:
There exists interrelationship among the above parties based on their role,
perspectives and ownership aspects. The role and perspectives of each party can be outlined
as follows:

Shippers and Consignees:

The main objective is to transport the goods from origin to desired destination at least
possible cost in a specified time limit.
 The transportation service is expected to fulfil the characteristics such as (a) No loss
or damage of goods, (b) Correct invoicing, (c) Predictable transit time, (d) Specified
pickup and delivery times and (e) Accurate transit information.
Carriers:
The important objective is to maximise revenue by minimising costs. The carrier tries
to charge the maximum possible rate acceptable to shipper or consignee by
minimising the operational costs such as labour, fuel and other incidental charges.
In order to achieve the said objectives, the carrier requires flexibility in pickup and
delivery time, so as to consolidate the individual transport needs into bulk economic
transport means.
Government:
The government contemplates to have a stable and efficient transport system, so as to
achieve rapid economic growth.
The government desires to have an efficient transport system, so as to ensure the
availability of various goods at reasonable price.
The government affects the transport sector through regulation and promotion.
Regulation can be done through controls, while promotion is possible through
incentives.
Public:
Public are more concerned with transport accessibility, efficiency, costs, pollution and
safety measures.
Development of transport system to a large extent depends on demand for goods
arising from public.
Though minimizing transport cost is important goal to consumers, yet trade off
associated with environmental and safety standards also require due consideration.
The above interrelationships can be shown diagrammatically (Figure 2.8)
The intermodal relationships are said to be complex, in view of interaction between
the parties. It leads to often conflicts between parties with micro interests namely shippers,
consignees and carriers as well as with a macro interest parties namely government and the
public. Finally, conflicts have led to duplication, regulation and restriction of transport
services.

PUBLIC

GOVERNMENT
Q.7 Advantages of Multimodal Transport System

The following are advantages of multimodal transport system.

1. Minimizes Time Loss:
As multimodal transport system is planned and coordinated as a single operation, it
`minimises the loss of time and the risk of loss and damage to consignment or goods
at trans-shipment points.
2. Ensures Smooth and Safe Transport:

Multimodal transport operator not only maintains his own communication links, but
also coordinates interchange and onward carriage smoothly at different trans-
shipment points.
3. Provides Faster Transport Service:

Multimodal transport system provides faster transport of goods. It reduces

the disadvantages of distance from markets and the tying-up of capital.
4. Saves Transport Costs:
Multimodal transport system helps in the reduction of transport costs as
single operator completes the entire job of transhipment of goods. Further, the system
also helps in the reduction of cargo insurance costs.
5. Improves International Price Competitiveness:
As multimodal transport system helps in the reduction of transport costs, it will in turn
result in reduced export costs and thereby improves international
price competitiveness.
6. Reduces Burden of Documentation and Formalities:
In case of traditional transport system i.e., segmented transport system there
arises multiple documentation and other formalities at various stages.
However, multimodal transport system reduces the burden of multiple documentation
 and other formalities as single operator completes the entire job of transshipment of
goods.
7. Establishes Unique Agency to deal with:
Unlike segmented transport system, multimodal transport system establishes unique
agency to deal with the entire job of transportation. Thus, the consigner deals
with only one operator relating to transport, insurance, loss and damage of goods.

Q.8 The important safety measures to be taken at material storage place is as explained
below:
1. Floors and supporting surfaces: Floors or surfaces required to support stocks,
shelving, racks or other means of storage should be capable of sustaining the
intended load together with shock loads.
2. Stock holding structures: Racks, shelving, bins, hoppers and other structures
for the storage materials should be adequately designed to support and contain
the materials for which they are used. Fire protective partitions should be used
between stored items.
3. Positioning of stacks: Building of stacks within wall and gap between the
stack and the wall should be maintained properly. Extra care should be taken,
if the storage area is affected by vibration from rail or road traffic outside or
inside the premises.
4. Storage racks and shelves should preferably be non-combustible and not prone
to retain water.
5. Suitable means should be used to protect workers from injury due to sharp
corners, projections or edges on structures and/or stored material.
6. Safe access, such as ladders, platform or walkways must be provided for
workers required to climb or remove goods from stacks, shelves and fixtures.
7. Safety belts are useful aids when dealing with high stacks and awkward
shapes.
Q.9 Functions of Storage System:

The storage system can be separated into two important functions; inventory holding
(storage), and material handling.
Storage functions:
Storage facilities are designed around four primary functions such as (1) Holding,
(2) Consolidation, (3) Break-bulk and (4) Mixing.
 1. Holding:
The most use of storage facilities is to provide protection and the orderly holding of
inventories. The facilities are different for different purposes such as long-term
specialized storage (aging of liquor), general purpose merchandise storage (seasonal
holding of goods), temporary holding of goods.
2. Consolidation:
Transportation rate structure influence the use of storage facilities. If goods originate
from a number of sources, it may be economical to establish a collection point to
consolidate the small shipments into larger ones and to reduce overall transportation
costs.
1. Break-Bulk:
Using storage of break-bulkis the opposite of using them to consolidated shipments. For
example, volume shipments having low transport rates are moved to the warehouse and
then reshipped in smaller quantities. Break-bulk is common in distribution.
2. Mixing:
Firms that purchase from a number of manufacturers to fill a portion of their product line
at each of number plants may find that establishing a warehouse as a product mixing
point offers transportation economies. Without a mixing point, customer orders might be
filled directly from producing points at high transportation rates on small volume
shipments. A mixing point permits volume shipments of portions of the product line to be
collected at a single point and then assembled into orders and reshipped to customers.
However a company must pay storage system costs either through rates charged by an outside
firm offering such services or through internal costs generated from the particular materials
handling system in a company-controlled warehouse. There are four different systems such as
public warehousing; leased warehousing, manual handling; private warehousing, pallet and
forklift truck handling; and private warehousing, automated handling.
Q. 10 Objectives of Material Handling:

The following are objectives of material handling:

1. To increase the warehouse facilitys usable capacity because utilizing as much of this
space as possible minimizes the warehouses operating cost. Many warehouses waste
the vertical space by not storing goods as high as possible.
2. To reduce the number of times a company handles goods. Generally, a company
moves products into a warehouse and places them in a storage area. Later moves them
 to an order selection area to be picked and made up into orders. And finally moves the
product again to ready them for shipment to customers. During this process, many
unavoidable movements may possible. Therefore, the design of any materials-
handling system and its associated activities should minimize movement to, within,
and from a warehouse.
3. The objective of effective working conditions has a number of significant dimensions
in the logistics area, including safety. All materials-handling systems, whether in
connection with logistics or manufacturing, should minimize danger to nearby
workers while enhancing productivity.
4. To eliminate as much as possible short-distance warehouse movements, which are
monotonous and involve heavy manual labour.
5. To improve efficiency by making the logistics system responds quickly and
efficiently to plant and customer requirements.
6. To reduce cost with efficient material handling. By utilizing space more efficiently
and misplacing items less frequently will lead to decreased cost.

Q. 11 Disaster Management in Railways

Railway has a Contingency Disaster Management plan under the Commercial

Department. Commercial Control office in Head quarters is monitored by officers on round
the clock basis. They collect information of the time and place of accident, number of people
injured/ dead, details of special trains to the accident site etc. Reservation chart or passenger
reservation slips, telephone number or fax number of the control room, hospitals nearby etc
will also be prepared. .
(1) Divisional office will set up a Control office at the site with telephone, FAX and Public
Announcement System (PAS). Announcement may be made for registering the names of
injured passengers, and the list will be verified by doctors to be given to the Control offices at
the divisions and head quarters, separately indicating the extent of injury -Trivial, simple &
serious.
(2) The site Control office will maintain a log book. Flow of information both incoming and
outgoing will be recorded. All necessary arrangements for refund as per rules will be made.
(3) A manual/ guide will be made available to train crew like; TTEs, AC Coach Attendants,
AC Pantry Car Staff, which will include DOs & DONTs for them in case of accidents.
(4) Commercial Control will ensure that at stations where trains are Delayed, Diverted, or
Terminated, additional alphabetical list of passengers on board with their current status must
be available and displayed at enquiry counters for quicker dissemination of information. It
will be ensured by CCM/IT, Divisional Control and Divisional Commercial Officers.
Duties of ticket checking staff on board will be:
(1) Collect Railway staff, Doctors and volunteers on the train or near the accident
site for obtaining assistance. (ii) Provide assistance to Guard in making quick
assessment of assistance required. (iii) To carry out the duties assigned to
them by Guard/Senior official present at the site of the accident.(iv) Take
action to save lives and render First Aid and organize relief operations with
the available assistance.
Q. 12 Pharma Company uses vide variety of chemicals. Hazardous chemicals may be
corrosive, irritating, toxic, flammable or carcinogenic. Direct skin contact with some
chemicals may cause burns or skin rashes from irritation or allergy. Chemical spills and
splashes may damage the eyes. Volatile chemicals such as solvents can be inhaled. High
concentrations of vapor or gas can accumulate in poorly ventilated areas. It is therefore
important that the workers, who work with chemicals aware of hazards, trained in handling
chemicals and follow safe work practices to avoid chemical exposure.
Safe-work practices for handling hazardous chemicals:
a) Provide local exhaust ventilation where there is a risk of inhalation
b) Provide emergency showers and eve wash where corrosives are handled
c) Wear suitable personal protective equipment
d) Do not allow unauthorized access to hazardous chemicals
e) Inspecting chemical stores regularly to check for deterioration or leakage
f) Keep stored quantity to a minimum
g) Ensure that all chemical containers are properly labeled and warning signs are
displayed in and around areas of chemical stores.
h) No smoking should be allowed at or near the storage area
i) Suitable fire-fighting equipment should be available
j) Highly toxic chemicals should be stored in double containment and kept under lock
k) Acids or alkalis should be stored in plastic or other suitable containers
l) Reactive chemicals should be stored in isolated, cool, dry areas and away from direct
sunlight
 SECTION C (Very Short Questions)
Q. 13

Logistics was defined by Greeks as the Science of correct measures by mathematics.

Logistics is the management of the flow of resources between the point of origin and the
point of destination in order to meet some requirements, for example, customers or
corporations. The resources managed in logistics can include physical items such as food,
materials, equipment, liquids, and staff, as well as abstract items such as information,
particles and energy. The term logistics comes from the late 19th century: from
French logistique, from loger 'to lodge'. Logistics is considered to have originated in the
military's need to supply itself with arms, ammunition, and rations as it moved from a base to
a forward position.
Q. 14
Fluctuation inventories have to be carried because sales and production times for the
product cannot always be predicted accurately. There are fluctuations in demand and lead-
times required to manufacture items. These require reserve stocks or safety represent the
fluctuation inventories.
2. Anticipation inventories are built up in advance for a big selling season, a promotion
programme or a plant shut-down period. Basically anticipation inventories store men and
machine hours for future need. It is frequently impossible and impracticable to manufacture
or purchase items at the same rate at which they will be sold. The items are, therefore,
obtained in larger quantities than are needed. This results in the lot-sixe inventory.
Q.15

Global. Specialization of agricultural functions permitting the transport of

temperature sensitive food products to distant markets. Enables the distribution of
vaccines and other pharmaceutical or biological products from single large facilities.
Local. Timely distribution to the final consumer of perishables, namely grocery stores
and restaurants.
Q. 16
Advantages:
The advantages of rail transport are (1) Economy, (2) Reliability (3) Efficiency of
Energy
 1. Railway freight charges are relatively low compared to other modes of
transport, particularly for transportation of goods at bulk over long distances.
2. Rail transport is highly reliable as it is independent of weather conditions.
3. Rail transport is energy efficient compared motor transport.
Disadvantages:
1. Rail transport is uneconomical in case of small shipments and for short distances.
2. Terminal handling costs are high and also such handling facilities may not
available at certain terminals.
3. Time schedules are not flexible.
Q. 17
In any business, it is likely to involve the stacking and storage of goods and materials. Every
year accidents occur while goods are being stacked or destacked and put into or taken out of
storage. Many of these accidents are serioussome are fatal. Racks, shelving bins, hoppers
and other structures for the storage of materials should be adequately designed to support and
contain the materials for which they are used. Proper care should be made for the possibility
of stored materials becoming water logged and for shock loads from placing materials or
from accidental contact by handling equipment. When partitions are used to increase storage
capacity, or to separate stored materials, they should be adequately designed and be of
sufficient strength to contain the stored material safely. Fire-protective partitions should be
used between stored items of differing vulnerability to fire. The corners or ends of shelving
and racks should be protected from damage by forklift trucks or mechanised equipment by
steel posts, angle irons or other means.
Q. 18
Planning principle: All material handling should be the result of deliberate plan where the
needs, performance objectives and functional specification of the proposed methods are
completely defined at the outset.
Standardization Principle: Material handling methods, equipment, controls and software
should be standardized within the limits of achieving overall performance objectives and
without sacrificing needed flexibility, modularity and throughput.
Work principle: material handling work should be minimized without sacrificing productivity
of the level of required of the operation
Q. 19
Over Speed
Speed thrills, but kills. The craze for a mad chase is the first and foremost reason for most
of the accidents. While driving one must bear in mind that you are not the only driver on the
road and you are not the only person who has busy schedules.
Mobile phones: A Mobile is a bane for a driver rather than a boon while driving. Many an
accident takes place due to its use, while the vehicle is on the run. A common sight along the
Indian roads is the use of mobile while driving. It is often alarming to see that the bikers use
mobile phone and ride free hand.
Drunk driving. It continues to be the major cause for road accidents and fatalities. Driving
under influence of alcohol took 10,553 lives in 2011.
Q. 20
Every goods carriage carrying Petroleum products shall display a distinct mark of the
class label showing that it is carrying inflammables.

Every goods carriage carrying petroleum products shall be fitted with a techograph, an
instrument to record the lapse of running time of the motor vehicle; time speed
maintained, acceleration and declaration etc., and a spark arrester.
Q. 21
ISO is defined as International Organization for Standardization. A standard is a document
that provides requirements, specifications, guidelines or characteristics that can be used
consistently to ensure that materials, products, processes and services fit for the purpose.
In logistics the maintenance of certain standards is the need of today as the trade at
international level has been increased and the freight movement also has been enhanced
simultaneously. Hence, the setting up and implementation of certain minimum standards is
very much needed. The ISO sets the quality maintenance standards as per the changing
conditions.
Q.22
Quality Control (QC): Quality control entails the basic procedural and statistical
management of quality:
defect-free services;
Management-driven.
Quality Assurance (QA): A greater emphasis on achieving user/user satisfaction through
user/user-driven quality characterizes. This is the shift from QC to QA:
100% satisfied user/user
user-driven
Q. 23
The workers in Iron and steel industry work under extreme temperature conditions
like too hot and exposed to thermal stress. It may lead to the health problems like
headaches, fatigue and heat disorders like heat strokes, heat cramps and heat
exhaustion, hypothermia, frostbites etc.
Some of the solutions to prevent heat stress
provide proper ventilation for air exchange in warehouses
avoid thick clothing
drinking plenty of water to prevent water loss

SECTION D (Objective Questions)

Q. 24 F
Q.25 T
Q.26 T
Q.27 F
Q.28 T
Q.29 (b)
Q.30 (a)
Q.31 (d)
Q.32 (e)
Q.33 (c)