Transportation and Security Research Project

Transportation and Security Research Project

Instructions/Descriptions

Analyze the transportation cost structures, modes, and  distribution centers, inventory control systems, and inventory costs  reduction strategies of the selected company.

Explain the relationships between freight rates and consignment weight.

Identify some of the many issues (including the effect of  supply chain strategies) that can impact the efficiency of transport  services used by the selected company.

Analyze the impact of relevant security initiatives, logistics  and transportation risks, and transport security technical systems for  the selected company.

Explain criteria that could be used to evaluate the impacts of those factors.

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Procurement and Inventory Management.

Evaluate the sourcing and procurement strategies as well as  potential sustainability and environmental issues for the selected  company.

Evaluate the inventory control systems used by the selected company.

Evaluate inventory costs reduction strategies used by the selected company.

Technology and Information Management.

Explain the logistics automation and logistic systems costs of the selected company’s supply chain.

Evaluate data capture methods used in the selected company.

Evaluate data flows in the supply chain.

Global Risk Factors.

Assess the effectiveness of the selected company’s approach to GSCM.

Apply Part 2 of the Supply Chain Risk Assessment Survey to your assessment.

Consider in particular levels of current and projected future  vulnerability, risk, and anticipated resilience strategies, as you  apply Part 2 of the survey to the supply chain of your selected  company.

Select 5–7 risk factors listed in Part 2 of the survey and provide a short assessment of each for your selected company.

How effective is the selected company’s approach?

How will you overcome or prepare for these risks to mitigate losses that can occur if these issues arise?

How would you suggest the company improves the strategy? Why?​​

Optional: Explanatory Videos.

Consider embedding explanatory videos that support your observations.

Conclusion.

​Revisit key points and important takeaways.

Discuss information gaps and questions for additional research.

Additional Requirements

Your assignment should meet the following requirements:

Written communication: Written communication is free of errors that detract from the overall message.

APA format: Follow current APA guidelines for style and format, including a cover page, headings, references, and citations.

References: Correlate your responses to assigned articles and integrate at least four references from  scholar-practitioner sources that you locate.

Length: A minimum of 1,800 words, not counting the title page, or references section.

Font and font size: Times New Roman, 12 point

I have attached the paper with the comments from the teacher to help guide along the way.

Introduction Comment by TJS: Additional specifics on the NAFTA tribunal process, outsourcing strategy, and global supply chain would have been nice to see.

Firms understand the reputational risk that the environment could cost their suppliers as a result of the launch of the green supply chain management initiatives. Firms have then opted to collaborate and work jointly with their suppliers to facilitate activities within the business and ensure that they are environmentally friendly.

Firms can hence engage with their clients one of the following two ways. One option would be to monitor their environmental performance or engaging with suppliers and collaborating and joining forces to ensure there are pro-environmental processes and practices are taken up (“Collaborate with suppliers to ensure green practices in the supply chain”, 2017).

Therefore, this paper seeks to discuss trade agreements that affect Amazon and their consequences, ways in which Amazon applies the NAFTA tribunal process to navigate laws that affect the firm’s dealings, some of the global collaborations strategies that Amazon may have implemented and their risk factors and finally Amazon’s global supply chain strategy.

Comment by TJS: Note that paragraphs need to be left justified Comment by TJS: This is a key point Comment by TJS: Anthropomorphisms should not be utilized. An anthropomorphism is the attribution of human characteristics or behavior to a good, animal, or object.

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REGIONAL TRADE AGREEMENT

Regional and other trade agreements that affect Amazon

Trade agreements are aimed at creating opportunities for firms to help grow the economy. Rules and policies are laid down for firms aiming to carry out businesses in the markets around the word and barriers are reduced to influence exports while protecting the interests of the involved firms.

There are a few trade agreements that affect firms in the US which include the World Trade Organization agreements, the Free Trade Agreements, and the Bilateral Investment Treaties. The government of the US has entered into treaties and agreements to facilitates trading activities across its borders.

Trade agreements regulate taxes, tariffs, and duties imposed on exports and imports (“Trade agreements”, (n.d.)). Comment by TJS: This is certainly the intention Comment by TJS: There are hundreds of trade agreements out there

Trade agreements may not always favor firms by providing reduced rates on tax and other forms of duties. Firms at times depend on duties and protective tariffs to shield themselves from the competition by other firms. This makes it rather difficult to conduct business hence end up going bankrupt and subsequently out of business.

Trade agreements are known to trigger competing agreements with other nations to do business with. This has often attributed to undo the few advantages that trade agreements bring forth in an attempt to level the business ground to make treading and business transactions less harsh and more bearable (Scott & Schott, 2016). Comment by TJS: This is an important point Comment by TJS: Correct. It is a matter of perspective

Consequences of choosing the wrong characteristics when classifying products for tariffs

When making agreements and signing treating that influence trading activity, it is important to make sound decisions during the negotiation process. In the past, there have been horrifying results of trade agreements causing more harm than good to firms and countries’ economies.

Firms and governments need to have strong negotiation skills to make better trade deals that equally and positively impact both parties to the agreement. President Trump has put some effort into renegotiating trade deals as he had promised to do. Better deals were made with China who was America’s source of automobile imports.

The US had the upper hand as the national security tariffs on steel and aluminum. Due to the trade war with China, a new deal was made between the United States, Mexico, and Canada to replace the NAFTA agreement with USMCA (Scott & Schott, 2016). Comment by TJS: This certainly can be the case if things are not fully thought out

The North American Free Trade Agreement had several weak points which led to huge losses and damages. Both the American and Mexican labor forces were negatively impacted by the North American Free Trade Agreement. Amazon as one of the firms whose largest area of operation was in the US suffered.

Amazon is the leading online retailer in the US hence items such as automobile spare parts are just some of the items that are most purchased by Amazon’s users. Firms shifted their production and manufacturing activities to Mexico as there was a cheaper source of labor as opposed to the United States. At least 682,900 jobs were lost in the US as activities were shifted down south (“Trade agreements”, (n.d.)). Comment by TJS: Great point here Comment by TJS: Correct. This has been a big area of contention

For products produced in Mexico was subjected to duties and other forms of tax. This made the trade and business environment quite harsh to deal with. In many cases, importing countries would also impose additional tariffs on components making it next to impossible to trade with other countries.

The price of commodities tends to become inflated causing firms to spend more than they are ready to spend on purchases and making little profit margins less than bearable to operate in. costs incurred in operation tend to go above the roof making business processes unsustainable for many firms (“Trade agreements”, (n.d.)).

It is important to identify tariffs in trade agreements that could influence the daily business activities. Working around trade tariffs could be of great benefit to firms as negotiations can be made to subsidize certain costs such as duty and tax expenses incurred during exports and imports.

Finding tariffs or negotiating tariffs that could impact business activities is considered as intelligent strategies on attempting to make a breakthrough in a given market space as often there could be better working conditions that could favor the daily business dealing creating more profits easier and faster (Scott & Schott, 2016). Comment by TJS: Great point here

Areas of uncertainties that can impact business strategies

At times, rules and regulations in treaties are quite unfair to one party hence the oppressed party will often retaliate spike a trade war. In this circumstance, it important that a tribunal process is taken up to help solve the issue amicably. As the most preferred method of recourse, it could be preferred that both parties try to arbitrarily solve the issues at hand.

This could be done renegotiating the initial terms that may have been harsh and tight to operate in. both parties can then air their views and points of grievances to the other party for reconsideration, renegotiation, and adjustment of terms. Both parties have an understanding of what they want from the trade agreements and how much they may be willing to give up (Ikenson, 2019). Comment by TJS: Correct. Tit for tat

There may certain areas of the trade agreement that may need adjustments of consideration. Parties may consider a slight simplification of procedures that could then reduce costs incurred to meet all compliance requirements for the benefit of the environment. Complicated procedures are often unnecessary as it only complicates issues for host countries to effectively harness the nosiness gains from global supply chains.

This discourages both foreign and domestic investments. Standards of compliance may need to be reconsidered and adjusted to be made reasonable and archivable for firms seeking to conduct businesses in a host country (“policy framework for investment user’s toolkit”, (n.d.)). Comment by TJS: Great point. At times simplification is the key

Similarly, upon negotiations, transaction costs can be sliced by a given percentage using more predictable and transparent processes. Simplified clearance systems can be implemented, and administrative requirements can be harmonized. This is often done by the adoption of applicable standards such as certification procedures, testing processes, and uniform and impartial administrative border requirements.

This releases pressure on firms as they attempt to comply with requirements, standards, and procedures associated with trade. Custom procedures ought to be designed to provide predictability, transparency, and simplicity. Impractical regulations and requirements often compromise business activities.

Similarly, inefficiencies in administration procedures hence creating unnecessary obstacles to firms who seek to do business and carry out trade transactions within a host country. This unnecessarily increases operational costs beyond a sustainable level hence could possibly drive out businesses as well as potential investors. (Ikenson, 2019) Comment by TJS: Good discussion here

GLOBAL COLLABORATIONS

Amazon has greatly relied on outsourcing its inventory management with more than 80% of its sales coming from third-party sellers. Amazon’s warehouses have been strategically located and stocked. This makes it easier to transport and deliver products to its customers. Using the push strategy, Amazon forecasts the demand for certain items within a given region while when products are from third-party sellers, it uses the pull strategy.

Similarly, Amazon had to acquire robotic automated services for its daily business procedures. This service was called the Kiva Systems which was later rebranded as Amazon Robotics which provides robotic warehouse solutions. Warehouse processes such as pick, drop, and rearranging procedures are done without human supervision.

Amazon has hence been able to complete warehouse activities quicker than before and kept its overall cost per unit at a minimum (Leblanc, 2019). Comment by TJS: Correct. Many do not realize this Comment by TJS: Fragments need to be removed . Every sentence must have at least one main clause. A main clause contains an independent subject and verb and expresses a complete thought. Comment by TJS: It did require a hefty investment though

GLOBAL SUPPLY CHAIN STRATEGY

Most deliveries are still being done by Amazon’s branded vehicles. Amazon has been described as the only firm in the United States of America to have been able to leverage its position to the point of partnering with corporates such as the United States Postal Services and FedEx to deliver its products to its customers.

Most of its customers are quite impressed by the prompt and timely deliveries. Amazon has opted for delivery firms as they have a better understanding of route networks that are proficient and adequate for delivery purposes. Amazon can hence focus on other logistical challenges as deliveries have been handled by more professional and experienced couriers that they are. Comment by TJS: I agree with this statement

Amazon has as well partially implemented a drone-based system that delivers products to the firm’s clients. The service is called Amazon Prime Air where it delivers products weighing under five pounds to locations within a ten-mile radius. Delivery times have been cut to thirty minutes or even less.

This has greatly increased people’s loyalty to the retailing online firm as they now have the capacity to push more products out of their warehouses and make delivery drops at an increased rate. This strategy was however faced with many hurdles along the way as the firm still sought to realize the dream.

The drones are yet to be fully commissioned to handle delivery drops and designed to self-destruct during flight in the event of any technical hitches to reduce any resultant damages and harm to people. Comment by TJS: Correct. Delivery will continue to be an area of focus

GLOBAL RISK FACTORS

There are certain risk factors that are common to firms that take up Green Supply Chain Management as such firms are heavily dependent on data. With a lot of customer data, cyber-attacks tend to be quite common in a world that has been connected by the internet. This could hence cost the firm a great deal in damages and reputation to its customers.

Similarly, war and conflict have a direct impact on supply chains hence production can be stopped as there is limited access to materials. Country disputes might as well erupt leading boycotts and economic turmoil that could greatly impact supply processes.

Supply chains have a direct relation to labor and related laws as they are the heart of supply chains. Any issues related to labor might bring about a huge ripple effect compromising logistics and other areas of supply (Ortegoli, & Ghadim, 2016). Comment by TJS: Great point here

CONCLUSION

It is of great importance that Amazon ought to closely scrutinize any agreements and treaties that impact its business strategy. Tariffs may at times be unfavorable for any business ventures to take place to their unpractically or at times is often unsupportive of the firm’s business strategy. Firms should invest in economies that have bearable policies to facilitate business development and ventures as a key requirement to the success and a guarantee of the future for the entity (“Collaborate with suppliers to ensure green practices in the supply chain”,2017).

References

Amadeo, K. (2020, February 14). 6 negative effects of NAFTA. The Balance. https://www.thebalance.com/disadvantages-of-nafta-3306273

Collaborate with suppliers to ensure green practices in the supply chain. (2017, July 20). Ideas for Leaders. https://www.ideasforleaders.com/ideas/collaborate-with-suppliers-to-ensure-green-practices-in-the-supply-chain

Ikenson, D. J. (2019, April 10). USMCA: A marginal NAFTA upgrade at a high cost. Cato Institute. https://www.cato.org/publications/commentary/usmca-marginal-nafta-upgrade-high-cost

Leblanc, R. (219, October 15). How Amazon is changing supply chain management. the balance small business. https://www.thebalancesmb.com/how-amazon-is-changing-supply-chain-management-4155324

Ortegoli, A., & Ghadim, M. R. (2016). The effect of risk factors on the green supply chain and prioritizing of the effects by using AHP. INTERNATIONAL JOURNAL OF HUMANITIES AND CULTURAL STUDIES, 1478-1493. http://www.ijhcs.com/index.php/ijhcs/index

policy framework for investment user’s toolkit. (n.d.). OECO. http://www.oecd.org/investment/toolkit/policyareas/trade/PFItoolkitTRADE.pdf

Scott, R. E., & Schott, J. J. (2016, March 17). Are Trade Agreements Good for Americans? The New York Times. https://www.nytimes.com/roomfordebate/2016/03/17/are-trade-agreements-good-for-americans

Trade agreements. (n.d.). International Trade Administration | International Trade Administration. https://www.trade.gov/trade-agreements

Transportation and Security Research Project

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