Risks Within The Transportation Sector in a Company

Risks Within The Transportation Sector in a Company
During the transportation of products from one place to the other, there are disruptions which can potentially occur along the way. It is, however, impossible to discover all types of risks that can occur concerning the transportation of products (Coyle et al., 2011). The Company type and its location among many other things are the ones who are responsible for impacting the risk categories that they may face. From the six common risks which are normally associated with transportation within a Company, this article is going to discuss two of them which are product loss and product contamination and damage.
Product loss
It encompasses all activities such as theft and mismanagement of products, which make the goods not to reach their intended destination (Waters, 2011). There are several losses which are linked to the product loss apart from the actual cost which comes alongside the lost goods; such indirect losses include, spoiled brand value, interference with the customer service, and the necessity of administrating a new shipment so that it can replace the stolen shipment. The indirect charge associated with product loss can be five times greater than the cost associated with the direct product loss. There are some ways through which the risk of product loss during transportation can be minimized; these includes improving the use of GPS to monitor and track down a stolen vehicle and secondly, improvement of the depot security.

Product contamination and damage
When handling goods, there is a high risk that those goods could be damaged, this will then translate to the loss of value by these goods. When goods lose value, they are either thrown away or marked down hence reducing the income of a company. Replacing the or marking down of the goods will mean that the monetary aftermath of the corporation will be affected, the need to process the goods so as to replace the damaged ones will also affect the financial outcome. Contamination of goods is yet another example of how goods can get spoiled during transportation services (Cui & Hertz, 2011). The kinds of goods usually exposed to such kind of damage are foods, consumables, and pharmaceutical goods. The longer the transportation time and distance, the more goods risk becoming contaminated. Product contamination and damage can be avoided by handling the goods correctly and not mixing of goods during transportation.
The risks associated with transportation can bring a very big loss to a company unless a quick action is taken (Volvo, 2012). Each and every Company needs to ensure that it is doing all it can to curb all the dangers associated with transportation losses so as to avoid experiencing financial problems.
References
Coyle, J. J., Novack, R. A., Gibson, B. J., &Bardi, E. J. (2011). Transportation: A supply chain perspective (7 ed.). Ohio: South Western Cengage Learning
Waters, D. (2011). Supply chain risk management: Vulnerability and resilience in logistics (2 ed.). London: Kogan Page.
Volvo. (2012). Service och reservdelar Retrieved 3 April 2012 from http://www.volvotrucks.com/trucks/sweden-market/sv se/parts_service/Pages/parts_services.aspx