When thinking about decisions regarding transportation you must consider speed, flexibility, cost, and convenience. If your company needed to ship high-priced silk T-Shirts from Asia to the United States, what transportation mode would you use? Justify your decision.
Fashion industry is ruled by the fast fashion trend today, and speed of the transportation mode hence plays a very important role in fast fashion. Manu fast fashion brands hence rely on air cargo shipping to bring their products quickly to their stores globally. Air cargo ensures that the garments arrive in their top condition as air cargo freight can offer humidity controlled and dust protected environment. Also, air cargo allows inventory allocation flexibility to the shipment, thus providing the ability to source and sell globally with no time constraints. And products being shipped from Asia to US do need that kind of flexibility and speed due to the distance between the source and the destination.
Although air cargo mode allows flexibility and speed, cost is a limiting factor here, as per World Bank data, air freight is priced 4-5 times that of road transport and 12-16 time of the sea transport. Hence, choice of air freight over other modes is simply an economic valuation situation where one has to analyze of the extra speed buys us the financial benefits enough to offset the significant increase in fright costs due to air shipping. In this case, since the product is high prices silk T-shirts, I believe that we have the scope of offsetting the cost of transportation through speedy delivery. Also, since the product is being shipped from Asia, which has cost competitive garment manufacturing companies, due to the raw material availability and low labour costs, we possibly will have enough margins in the product pricing to accommodate the air freight costs provided the clothing reaches the stores in time.