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Containerisation

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What is containerization and how did the innovative use of containers transform the distribution of goods? “Containerisation is a method of distributing merchandise in a unitised form suitable for transportation by rail, road, air, canal and sea.” (Branch, 1996, p.194). The simple principle of the container has undoubtedly made the global economy grow, and brought the world closer together through ease of transportation (Wetherly & Otter, 2008, p.86-7). To be able to use one single sized unit for the transportation of goods was the ultimate solution to transporting cargo, which was becoming larger part of global trade, and helped put shipping into the modern age. In 1956, Malcolm McLean used an innovative idea to transport 58 trailer …show more content…

This reduces the need for warehouse space, decreases the risk of obsolescence and improves stock control (Hann, 2010). Faster transportation has transformed the distribution of goods in allowing a greater selection of cargo to travel further than it was previously capable of. So what about the costs? "The container made shipping cheap" (Levinson, 2006, p.10). Just after McLean’s idea, it was thought that the costs of shipping were 11 percent of the value of United States exports, and could be as high as twenty-five percent. By contrast, shipping costs in comparison to product price have fallen sharply. (Asteris, 2009). It is not just the use of containers and ships that is responsible for the transportation costs, the larger normal routes, the increasing competition between the major container ship operators, such as Maesrk and Evergreen, the investment in modernising crane handling equipment and the logistics, have all had an impact. Before containerisation, businesses thought of distribution as a series of processes, ships, trucks and trains. Somebody had to move every box and pallet, and could easily consume half the cost of shipping. Levinson (2006) described this as “breaking bulk”. With goods waiting in warehouses ready to be moved onto the next stage, transferring and delays made shipments slow and the delivery times erratic. The introduction of containers meant that for the first time, cargo could be locked away when in storage. Whiskey was

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