Logistics refers to the transportation of goods and merchandise -- raw materials or finished products -- from the point of production to the point of final consumption. Different modes of transportation like road, rail, water and air can be used for the effective management of merchandise. Every mode of transportation requires a different set of infrastructure, type of vehicles, technological solutions and regulations. All have different costs, service and transit times.
Road transportation is one of the most basic and historical means of transportation from one place to another. There are many different types of automobiles found on roads, although trucks and carriers typically are used for carrying or delivering freight. Road transportation incurs a relatively lower cost than other logistic forms and has a widely recognizable and flexible route. However, transport by road takes a relatively longer period of time than other possible means of transportation, and it offers a limited capacity. Road transport is most often used for relatively inexpensive, non-perishable items or for shorter distances.
Rail transport uses freight trains for the delivery of merchandise. Freight trains are usually powered by diesel, electricity and steam. Since the late 1900s container trains were considered to be the dominant solution for bulk quantities of freight, but as they lack the flexibility of road transport and incur an additional transshipment cost, this logistics method has become a little less popular in recent times. However, using rail transport can be less expensive if freight is large and heavy and the pickup point as well as the delivery point is near the rail head.
Water transport uses ships and large commercial vessels that carry billions of tons of cargo every year. Developed in the 18th century, steam engines have been a long favorite choice for making ships move, although now a little more refined type of petroleum referred to as bunker fuel is used instead. Sea, lake or river transport is particularly effective for significantly large quantities of goods that are non-perishable in nature and for cities or states that have water access. Moreover, transport via water is considerably less expensive than other logistics methods, which makes it one of the most widely used choices of transport for merchandise.
Merchandise is carried in cargo holds within passenger airlines and/or via aircraft designed to carry freight alone. Although air transport is more expensive than all other means of transportation, it is undeniably most time-efficient. Perishable merchandise like fruits and vegetables are mostly sent by air.