LG 312
Chapter 2
5. Compare and contrast time and place utility, and explain how they contribute to the value of
products. What is the importance of time and place utility in our global economy? Place utility is
the usefulness or value of a good or service as a function of the location at which it is made
available. For example, a snow shovel have greater place utility in Boston that in El Paso. The
more efficient the method of transportation the greater the potential market area and the great
place utility, Time utility is the usefulness or value of a good or service as a function of it
timeless in meeting seasonal demand. The demand for a particular commodity may exist only
during certain periods of time. Effective transportation can create time utility by ensuring that
product arrive where they are needed and at a time when they are needed. Time and Place utility
are important to the global supply because of the greater distance and transportation system
determine the economic value of the product.
10. The service characteristics of freight movement are considered by some shippers to be as
important as or more important than freight rate. Discuss the various service characteristics for
freight demand. Do you agree with the statement that they may be as important as or even more
important than the freight rate? Why or why not? The four types of freight demand are:
a. Transit time – it can affect the level of inventory held by the shipper and the receiver as well
as the associated carrying cost of holding that inventory.
b. Reliability –it refer to the consistency of transit times. Meeting pickup and delivery schedule
enable shipper and receivers to optimize service levels and minimize stock cost
c. Accessibility – is the ability of the transportation provider to move freight between a specific
origin and destination.
d. Security - is concern with safety of good in transit. Shipment that are damaged or lost in transit
can cause increased cost in the areas of inventory and or stock outs.
I think that freight demand are more important than freight rate because if the company does not
have the freight on time and in good condition they will not have anything to make a profit off of
the freight.
Chapter 2
5. Compare and contrast time and place utility, and explain how they contribute to the value of
products. What is the importance of time and place utility in our global economy? Place utility is
the usefulness or value of a good or service as a function of the location at which it is made
available. For example, a snow shovel have greater place utility in Boston that in El Paso. The
more efficient the method of transportation the greater the potential market area and the great
place utility, Time utility is the usefulness or value of a good or service as a function of it
timeless in meeting seasonal demand. The demand for a particular commodity may exist only
during certain periods of time. Effective transportation can create time utility by ensuring that
product arrive where they are needed and at a time when they are needed. Time and Place utility
are important to the global supply because of the greater distance and transportation system
determine the economic value of the product.
10. The service characteristics of freight movement are considered by some shippers to be as
important as or more important than freight rate. Discuss the various service characteristics for
freight demand. Do you agree with the statement that they may be as important as or even more
important than the freight rate? Why or why not? The four types of freight demand are:
a. Transit time – it can affect the level of inventory held by the shipper and the receiver as well
as the associated carrying cost of holding that inventory.
b. Reliability –it refer to the consistency of transit times. Meeting pickup and delivery schedule
enable shipper and receivers to optimize service levels and minimize stock cost
c. Accessibility – is the ability of the transportation provider to move freight between a specific
origin and destination.
d. Security - is concern with safety of good in transit. Shipment that are damaged or lost in transit
can cause increased cost in the areas of inventory and or stock outs.
I think that freight demand are more important than freight rate because if the company does not
have the freight on time and in good condition they will not have anything to make a profit off of
the freight.
