What are the seven economic drivers? Briefly explain each

What are the seven economic drivers? Briefly explain each. Distance, Weight, Density, Stowability, Handling, Liability, and Market Distance- distance is a major influence on transportation cost because it directly contributes to variable expense, such as labor, fuel, and maintenance. Weight- the transport cost per unit of weight decreases as load size increases. Small loads should be consolidated into larger loads in order to maximize scale economics. Density- density is the combination of weight and volume. Both weight and volume are important since transportation cost for any movement is most of the time quoted in dollars per unit of weight. Stow ability- stow ability refers to how product dimensions fit into transportation equipment. Different sizes and shapes, as well as large size or length may not fit

well in transportation equipment, which will result in wasted capacity. Handling- certain handling equipment may be needed to load and unload trucks, railcars, or ships.

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Products being grouped together in boxes and pallets will impact handling costs. Liability- this includes product characteristics that can result in damage. Carriers must either have insurance to protect against potential damage of accept financial responsibility. Market- market

factors such as lane volume and balance influence transportation cost. Since transportation vehicles and drivers usually return to their origin, they must either find a backhaul load or the vehicle is returned or deadheaded empty. When a truck is returned empty maintenance, fuel, and labor costs must still be charged.

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