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Business Studies Notes on Transport

Transport | Business Studies Notes

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Transport

Transport is the physical movement of people and goods from one place to another.
It helps bridge the gap between producers and consumers hence creating place utility.

Read More On:
  1. Land Transport
  2. Water Transport
  3. Air Transport & Containerization
[Click on the links above to read more on Modes of Transport]

Importance of Transport to Business

  • Bridging the gap between producers and consumers/linking consumers to producers-Transport links consumers to producers which enable the consumers to obtain the goods they need.
  • Employment creation-Transport helps in solving unemployment problem by creating job opportunities. For example, people may be employed as drivers, pilots, mechanics and road constructors.
  • Promotes specialization-Transport enables people to specialize in jobs they are best at. For example; producers would concentrate in production only while other people carry out distribution.
  • Making goods and services more useful-Through transport goods are moved from a place where they are least required to a place where they are most required thereby making them more useful.
  • Improving people’s standard of living-It enables consumers to get a variety of goods and services thereby improving the standards of living.
  • Availing a wide market for products-It helps producers to widen the markets for their products by enabling them access to areas they would otherwise not have accessed
  • Increased production/facilitates mass production-Due to the wider market created through transport, producers are able to increase the volume of goods produced.
  • Avoiding wastage-Transport makes it possible for surplus goods to be disposed of by taking them to areas where they are required. Perishable goods such as flowers, fruits and vegetables can also be transported fast hence minimizing/ avoiding wastage.
  • Promoting development of industries-Through transport, raw materials can be taken to manufacturing industries and also finished goods to the market. Similarly, it promotes development of service industries such as tourism.
  • Adds value to goods and services- creates utility in goods by moving them from the point of production to where they are needed thereby adding their value.
  • Leads to the opening of new markets- Goods and services can be taken to new areas with ease.
  • It facilitates the movement of labour- people can easily move from where they stay to where they work.

Essential Elements of Transport

  1. Unit(s) of carriage - This refers to anything i.e. vessel that is used to transport goods and people from one place to another. Units of carriage include: ships, trains, aeroplanes, motor vehicles, bicycles and carts. Units of carriage are also referred to as means of transport.
  2. Methods of propulsion - This is the driving force (source of power) that makes a unit of carriage to move. The power for most vessels may be petroleum products, electricity, human force or animal power.
  3. Ways - It refers to either the route or path passes by the vessel. The route can be on land, on water or through air. Examples of ways are roads, railways, paths, canals, seaways and airways. The ways can be classified into either natural ways or man-made ways
  4. Terminals(terminus) - The vessel used to carry goods and people starts from one destination and ends up at another. At these destinations the loading and off-loading take place respectively. The loading and off-loading places are referred to as terminals or terminus. Examples of termini are bus stations, airports and seaports.

Modes of Transport

Mode refers to the manner in which transport is carried out. There are three modes of transport namely:
  1. Land transport
  2. Water transport
  3. Air transport

Factors that Influence the Choice of Appropriate Means of Transport

  1. Cost; The cost of transporting a good should be reasonable; except where other factors should be considered such as need for quick delivery. Otherwise should be proportional to the value of goods transported.
  2. Nature of goods; The nature of goods should be considered when choosing a means of transport. For example, perishable goods require a fast means. Similarly, heavy and bulky goods require a means of transport convenient for such goods e.g. trains and ship.
  3. Reliability; The means chosen should be able to deliver the goods to the required place at the right time and in the right form.
  4. Urgency; For goods that are urgently required, the fastest means available should be chosen.
  5. Safety and Security:The means chosen should ensure that the goods on transit are secure against loss, theft or physical damages.
  6. Distance; Some means of transport are suitable for long distances while others are suitable for short distances. If goods are to be transported for long distances, air, sea or railway transport would be appropriate, otherwise roads would be suitable for short distances.
  7. Availability of means; The means of transport to be selected should be based on its availability. For example, where there is only one means of transport, it would be the only one to be chosen.
  8. Flexibility; This is the ability of means of transport to be manipulated to suit the convenience of the transporter. Where flexibility is required, then the means that would provide such should be chosen. For example a matatu is usually more flexible than an aeroplane.
  9. Terminals; Some means of transport may have their terminals near the transporter than others. In this case, the transporter should choose the means whose terminals are conveniently accessible to facilitate loading and offloading of goods.
  10. Value of goods to be transported- goods of high value require special handling and high security during transportation.

Trends in Transport

  1. Pipeline and containerization
  2. Electric trains are replacing diesel engines
  3. Underground tunnels for trains are being used to ease congestion on the surface
  4. Dual-carriage roads are being developed in various parts to ease congestion and minimize accidents
  5. Development of planes with larger carrying capacity and speed is a major feature in the transport industry
  6. Use of bicycles commonly known as bodaboda are a common feature in towns, bus terminals and rural areas, supplementing other means of transport to ferry people and cargo to their destinations.
  7. Motor cycles are also being used as bodabodas in various areas. Similarly, the three wheeled vehicles commonly known as ‘TukTuk’ is a major feature in cities and most towns.
  8. Private personal vehicles with less carrying capacity e.g. four-seater vehicles are being used as matatus.

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