Price Elasticity

Condition
Factors
Example
Geography
Distance and accessibility Long distance rates
Type of product
Packaging, weight, perishable
Seafood; time sensitive goods Shipping coal
Shipping flowers or meat
Economies of scale Shipment size
Container vs less than container
A Boeing 747 (350 passenger) compared to B (125 passengers)
A Panamax Containership compared to a Post-Panamax Containership
Trade imbalance
Empty travel- back haul rates”
Trade between China and the United States
Infrastructure
Quality of Surface
Natural disasters

Condition
Factors
Example
Elasticity of Demand
High value versus Low value goods
Grain vs. Machines
Fabrication in transit
Uniform rate to capture business
Grain to cereal
Competition and regulation
Cost reductions to capture traffic
Rail vs. highway
Energy
Energy prices
Fluctuations in oil prices
Mode
Capacity, limitations, operational conditions
Air cargo rail bulk distance limits?
Conditions Affecting Transport Costs

Effect of Transport Costs on Route Selection https://people.hofstra.edu/geotrans/eng/methods/routedistance.html

Logistics Costs and Average Transit Time of a
20 Foot Container, Mombasa - Nairobi (Kenya)
Source: CPCS Transcom (2010) Analytical Comparative Transport Costs Study Along the Northern Corridor Region

Assignment
• Due date To be submitted in the tutorial in Week 9
1. Calculate the total logistics Costs & Average Transit Time. Show the alternative routes, and cost associated with each route.
a. A container from oriental wavers factory in the 10
th of Ramadan city Industrial zone to Hamburg port.
b. Exporting grapes from a farm in Behira governator to Marks & Spencer in London.