Intermodal Transportation: Global vs. Domestic Supply Chains Case Study

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Global Supply Chains

Dewitt and Clinger (n.d.) express that supply chain management is more complex in the case of international trade, compared to domestic trade. This, according to Yevdokimov (n.d.) is particularly because of the differences that exist between the trade requirements and rules of different destination countries. Moreover, a number of export compliance regulations that are non-existent in the case of domestic trade have to be taken into account in the management of global supply chains. The key ones include FTR (Foreign Trade Regulations), EAR (Export Administration Regulations), and ITARs (International Traffic Arms Regulations). A 2009 report by Thomson Reuters indicates that violation of such export control regulations attracts heavy fines and penalties.

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The FTR governs the procedures involved in the reporting of shipments. The FTR regulations provide guidelines on among other things, the reporting of exemptions and the requirements of the Automated Export System (AES) (Weigel & Schwartz, 2009). Further, it provides a substantive definition of export valuation, as well as information on the individual responsibilities of both the exporter and the foreign buyer. For instance, it provides guidelines on the kind of records that ought to be kept; whose responsibility it is to obtain licenses; how export commodities are classified, controlled, and regulated by the regulating agency; who makes entries to the AES, etc. (Weigel & Schwartz, 2009).

TOPIC: Case Study on Intermodal Transportation: Global vs. Domestic Supply Chains Assignment

The EAR, on the other hand, deals with the statistical reporting of export shipments. It focuses on regulating goods that are not under the coverage of regulatory agencies and those that are of a dual-use nature -- goods that besides their commercial function can also be used in destinations or applications that the U.S. deems "unfit." These include nuclear materials, propulsion systems, marine, sensors and lasers, toxins, and chemicals (MIT, 2014).

The ITAR regulations govern the shipment of arms. They require "exporters to obtain authorization (e.g. licenses) from DDTC for exports of defense articles" (Weigel & Schwartz, 2009, p. 2). Shipments covered under this regulation include military equipment and weaponry. The regulations, however, are not so clear when it comes to companies that deliver munitions to the defense industry. Towards this end, companies within the defense industry are required to review the ITAR regulations before engaging in any kind of exporting or outsourcing procedures.

Originally, tariffs were charged on shipments being transferred to foreign destinations; the North American Free Trade Agreement (NAFTA), however, did away with such barriers in trade between the three member countries (the U.S., Mexico, and Canada), making the supply chain easier to manage.

Conclusion

Intermodal transportation is a key development in the transportation industry. It facilitates efficiency and productivity, particularly in freight shipment. Globalization has, however, brought to light a number of key concerns, one of them being that countries have different trade regulations. Challenges are deemed to arise, particularly if the regulations of the exporter's country are in conflict with those of the buyer's.

References

Dewitt, W. & Clinger, J. (n.d.). Intermodal Freight Transportation. Committee on Intermodal Freight Transport. Retrieved 15th October 2014 from http://onlinepubs.trb.org/onlinepubs/millennium/00061.pdf

MIT. (2014). The Export Administration Regulations (EAR). Massachusetts Institute of Technology (MIT). Retrieved 15th October 2014 from http://osp.mit.edu/compliance/export-controls/the-export-administration-regulations-ear

Weigel, K.J. & Schwartz, J.M. (2009). International Government Contractor: News and Analysis on International Public Procurement and Export Controls. Thomas Reuters, 6(4), 1-9.

Yevdokimov, Y.V. (n.d.). Measuring Economic / benefits of Intermodal Transportation. Mississippi State University. Retrieved 17th October 2014 from http://ncit.msstate.edu/PDF/7-Measuring-Economic-Benefits-of-IntermodalTransportation.pdf [END OF PREVIEW] . . . READ MORE

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