“LOGISTICS MANAGEMENT IN VRL LOGISTICS LTD VARUR” operators working on a hub and spoke distribution model. The industry interactions with operators and users also revealed that apart from their broad-based transport stock, large fleet operators are able to generate business on account of goodwill, assurance of timely delivery and quality, distribution network and necessary infrastructure. Transport operation and haulage Large fleet operators operate on all haulage segments — short, medium and long. However, as they are dominant in the medium and long haul operations, they operate on a hub and spoke system of distribution. As the large operators cover a wide geographical area, ranging from 200-1,500 km or even more, they typically have a wide network of branches throughout the country, apart from the necessary infrastructure to support their network. This enables them to attract users and get business on a continuous basis. Unlike small fleet operators / single truck owners, large fleet operators operate on both the full truckload and parcel truck load operations. Parcel truck load refers to small packages booked by consignors that occupy only a part of the entire truck space. Large fleet operators are able to operate in both the segments due to their wide range of distribution network and clientele, the consignors’ perception of higher reliability and quality assurance.
FREIGHT RATES As per the research, demand-supply and cost factors emerge as the two key determinants of freight rates; however, regulations and industry structure also have a role to play in influencing freight rates. These factors explain why freight rates have risen continuously over the past five years, despite significant fragmentation of the road transport sector. Over the next 5 years, the cost of transport operations may reduce structurally and this will reduce freight rates (adjusting for inflation); however, the rates may continue to remain firm over the next 1 year, due to continuation of healthy economic growth as well as cost pressures.
FREIGHT RATE DETERMINANTS
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