School of Business and Management

August 2021 Online Final Assessment

BM2534
FREIGHT TRANSPORTATION
3 Hours

Exam Number: 81094

Online Final Assessment Date : 03/08/2021

Name: SHISAUN A/L SARGUNA SILAN

Id: H2009413016
Appendix 4
 Online Final Assessment Declaration for Students
Student Declaration

I understand that:

1. Plagiarism is the presentation of the work, idea or creation of another person as

though it is my own. It is a form of cheating and is a very serious academic offence
that may lead to exclusion from the University. Plagiarised material can be drawn
from, and presented in, written, graphic and visual form, including electronic data
and oral presentations. Plagiarism occurs when the origin of the material used is
not appropriately cited.
2. Plagiarism includes the act of assisting or allowing another person to plagiarise or
to copy my work.
3. Plagiarism is a very serious offence and is strictly NOT acceptable.
4. All my final assessment answers will be sent for plagiarism checking. If the
plagiarism rate is more than 30%, I will be given a ZERO (0) mark.
5. If any two students are found to have answers with a similarity of 50% and above,
50% of the marks awarded will be DEDUCTED from both students.

I declare that:

1. This work is my original work and no part of it has been copied from any other
student’s work or from any other source except where due acknowledgement is
made.
2. No part of this work has been written for me by any other person except where
such collaboration has been authorised by the lecturer concerned.
3. I have correctly acknowledged the re-use of any of my own previously submitted
work within this submission.
4. I give permission for this work to be reproduced, communicated, compared and
archived for the purpose of detecting plagiarism.
5. I give permission for a copy of my marked work to be retained by the school for
review and comparison, including review by external examiners.

I declare that I have read and understood the declaration statement above.

Exam Number: 81094

Online Final Assessment Course Code (example, MPU3113): BM 2534
Date: 03 AUG 2021
Name: SHISAUN A/L SARGUNA SILAN
ID: H2009413016

SECTION A
1. The first reason how UPS achieved its present reputation of its performance
compared to FedEx is due to the achievement on the strength of distinct
ground delivery of packages and document. FedEx success is because of its
traditional attribute and repeat of incomparable achievement in overnight
deliveries. Although, an average of approximately 5 million daily deliveries are
made by FedEx, UPS still outperforms FedEx in air deliveries.

2. There are five advantages that UPS had compared to FedEx. UPS has major
improvement in the goods sorting and delivery systems. Due to improved
technological systems, UPS has reduced operating costs while improving
productivity. UPS calculates global reach to always stay ahead in the global
market. UPS also maintains good relationships with its customers. UPS has a
well-maintained brand equity because of their good service to their
customers. The competitive strength of UPS is its capabilities to operate with
e-commerce perfectly. Besides that, UPS had a few growth strategies that
were implemented to reach such great heights. Since UPS is one of the
leaders in domestic express operations, they continue to maintain position as
a leader and stay in the game while competing with FedEx. Not only that,
UPS is always focused on expanding their company internationally. When
organizations which work with UPS has any problem, UPS will provide first
class solutions to their customers. Some organizations are attempting to
outsource a complex component; therefore, UPS will provide support. Lastly,
UPS also uses an array of e-commerce technologies to support their main
delivery service.

3. FedEx success is because of its traditional attribute and repeat of

incomparable achievement in overnight deliveries. An average of
approximately 5 million daily deliveries are made by FedEx. There are a few
growth strategies of FedEx. FedEx has successfully increased their service in
transporting high technology products and business goods that have high
value. For example, electronics and important documents. FedEx has evolved
into globalization while improving their productivity. FedEx has also
magnificent speed of handling the supply chain. Not only that, but FedEx has
also improved in expanding the use of internet and e-commerce. The
company’s strong business asset is its brand. The company uses its brand
amazingly by providing customers with a perfect integrated business solution.
For example, FedEx has a website called FedEx.com for its customers and
 newcomers.

SECTION B
1. A) A freight transport consists of four elements which are often described
as permanent ways, the Cargo Transport Unit (CTU), the motive power and
the terminal. Permanent ways or natural ways are cheap and free sometimes.
The ways have no maintenance costs unless we try to improve them
artificially. Examples of natural ways are the sea, the air, the rivers, and
footpaths are natural ways. Natural ways are often subjected to the changes
of nature. Sometimes these natural ways need to be improved artificially. For
example, rivers are vulnerable to flood during rain periods, therefore walls are
built higher with drains to ensure the efficient flow of water during flood.

The Cargo Transport Unit (CTU) is also known as a transport vehicle.

The efficiency of the mode transport depends on the flexibility and adaptability
of the unit of carriage used. For example, road vehicles are adaptable
compared to railways rolling stock this is because road vehicles can
immediately adapt to the change of a faster route if there is an obstacle
present. Another example, ships and aircrafts are also more adaptable and
less tightly bound by the way on which they travel.

The motive power is defined as any type of steam, diesel, or electric

locomotive, traction unit, maintenance vehicle, or other type of self-propelled
vehicle that runs on rails. Every unit of carriage must be driven by the motive
power unit which depends on the strength of vehicle, speed required,
available fuel and other factors. For example, in this modern era, the steam
engine has been replaced by the petrol engine, jet engine, diesel engine and
electric motor.

A terminal is an area or location which serves as a pathway for

handling transport process such as loading and/or unloading cargo. Any of
the place where goods are loaded or unloaded onboard a vessel/vehicle for
transport is referred to as a terminal. Terminals may be interchange points
within the same modal structure, ensuring flow consistency. This is especially
true for air and port operations, which have hubs that link different parts of the
network. Terminals, on the other hand, are crucial points of transition between
modes. A terminal plays many roles such as a port to service CTU, storage pf
cargoes before next exporting, and also has a regulatory department.

B) The ISO containers are composed of stainless steel and have a

variety of protective layers around them. Different skins can be utilised
depending on the cargo type. On top of the container, there is a manhole, as
well as at least one valve and another valve on the bottom. The ISO tank is
shaped like a cylinder. ISO tanks can hold between 21,000 and 23,000 litters
of liquid since they are manufactured to ISO specifications. Different skins
can be utilised depending on the cargo type.

The concept of intermodalism involving the ISO standard sea

container require close linkages among three elements of the Transport
System. Permanent ways decide how the ISO tanks should be transported.
This is due to ISO tanks allow shiploads or truckloads of liquids to be
packaged and easily transported by truck to the railway, from the train to the
ship deck, and in certain situations, ISO tanks will be conveyed by air,
shipping and handling costs are reduced. ISO standard container strongly
supported by three modes of transport: sea, truck and rail.

The Cargo Transport Unit (CTU) also is important to be chosen wisely

for ISO containers. The type of cargos ISO tank can carry are milk and other
dairy products, alcoholic and non-alcoholic beverages, liquefied sugars,
hydrogen peroxide, Sulphur acid / nitric acid and many more liquid and gas
form chemicals. The increasing effectiveness of ISO tank containers for
efficient bulk liquid transportation is making them a desirable shipping option.

Cranes and other material handling devices are constructed to easily

attach to the tank and safely transport it from vehicle to vehicle since all the
containers are the same size, have mechanically stable frames surrounding
them, standard connections, and mechanisms for securing them securely in
place. This is why ISO tanks require close linkage to terminal. The CTU and
terminals were modified to accept the ISO standard containers.
2. The practice of unitisation in freight transport has provide advantages
over traditional breakbulk cargo. Since the practice of unitisation was
introduced into the logistics supply chain, the handling of cargos is more
efficient as it is handled by high skilled level workers. The traditional
breakbulk cargo costs a lot of money and consumes a lot of time. Using a
container to transport the same quantity of break-bulk freight costs around 20
times less than using traditional methods. Containers provide for economies
of scale at modes and terminals that would otherwise be impossible to
achieve with traditional break-bulk handling. Containerization's key cost
advantages come from cheaper intermodal transportation costs. Breakbulk
cargo also is labour intensive in multiple cargo handling.

The practice of unitisation has prevented labour intensive in multiple

cargo handling. Back in the traditional days of breakbulk cargo, had high
incidences of cargo damage. Unitisation provides a safer way of containing
the cargo. The items are well-protected by the container, which works as a
physical barrier against severe weather, temperature changes, fire, theft, and
impacts during handling. As a result, the container considerably decreases
the risks of degradation, damage, and theft associated with land
transportation.

Not only that, but practice of unitisation has also helped lowered the
insurance premium rate too. Besides that, breakbulk cargo is inefficient in
speed. Ship port turnaround times have been cut from three weeks to around
24 hours, thanks to minimum and quick transhipment processes. Transport
chains including containers are faster as a result of this unitisation advantage.
Container shipping networks are well-connected and provide a diverse range
of transportation alternatives.

The practice of unitisation has proven to decrease the amount of time

consumed to load and unload. This gives a higher benefit to the transporter to
deliver the cargo in a shorter travel time. The terminals built these days also
works efficiently due to cargo unitisation. High level mechanism in terminals
gives out higher output in shipping cargos which proved to shorten the
duration of port stay by CTU at terminals.
 The practice of unitisation has improved in cargo flexibility. Containers
may transport a wide range of things, including commodities such as coal or
wheat, manufactured items, automobiles, and perishable products. Dry
freight, liquids (oil and chemical items), and refrigerated freight all have their
own containers. Containers that have been discarded can be recycled and
utilised for various purposes.

Containers can easily swap bodies and are truck and rail compatible.
Therefore, it maximizes the utilization of trailer or CTU. It has a lightweight
design where it can maximize cargo load and minimize transport fuel costs for
the transporter. It is proven to have faster transportation with lower costs. The
container is the unit that documents all of the items it contains as the
information is detailed on the exterior of the container. This information
increases the speed rate of customs requirements checking.

3. a) A bill of lading is a document that has all the information such as the
quantity, type and destination of the cargo being carried. This document is
typically issued by a carrier to a shipper. When good are being delivered to
the specific destination, a bill of lading acts as a shipment receipt. Bill of
Lading will accompany the products that are being shipped. A Bill of Lading
can only be signed by authorized personnel from the carrier, shipping agent
and the receiver.

b) If a buyer does not wish to have dealing with Freight Transport, it

proves that the seller is responsible to arrange transport and deliver the
goods to the buyer’s preferred location. There are two incoterm 2010 that the
buyer can select. Delivery Duty Unpaid (DDU) and Delivery Duty Paid (DDP).
Delivered Duty Unpaid (DDU) is a trade term that proves that the
seller must be responsible for the safety of delivered goods. The seller must
pay all transportation fees and assume all risks during transport of goods. The
main advantage of DDU shipping is that the buyer has better control over the
shipping procedures. When the goods reach the agreed location of the buyer,
the buyer then becomes responsible for paying the import duties and other
additional transport costs. The buyer will be contacted by the customs when
the shipment reaches. The buyer has to pay any fee charges so that the
customs will release the shipment. Once the shipment is released by the
customs, only then the goods will be delivered to the buyer.

Delivered Duty Paid (DDP) is an agreement between the seller and

the buyer whereby the seller takes all responsibility and risk of the goods
being transported. The seller is also associated with the expenses and costs
for transporting the goods until the goods reach the buyer locations.
Expenses such as export and import duties, insurance, shipping costs
incurred for shipping to an agreed location. The seller is also responsible for
transporting the goods and paying all costs in sending the goods to the
destination. This includes import duties and taxes too. The buyer will have no
risk or will not be responsible of the goods until it is delivered to the agreed
destination.