Posted by: changholt | April 1, 2010

Logistics and money Part 2

The Economic Importance of International Logistics part II

The environment in which international logisticians operate is quite different from the domestic environment. You really don’t want to make the mistake of mixing these two departments because, the decisions regarding international transportation are eminently more complicated:

  1. International insurance is much more complex
  2. International means of payment are more involved
  3. Terms of trade are much more complicated
  4. The crossing of borders represents specific challenges
  5. Inventory is managed differently
  6. The number of intermediaries involved is greater
  7. The inherent risks and hazards of international transportation are much more significant.

All though it’s complicated and there are a lot of variables involved, there is also a lot of money to be made. the key is making it a calculated risk.

International logistics is probably 15% of total international trade volume or approximately US $1.2 trillion (not that’s worth investing in…). The value of monies collected through tariffs probably results in US $500 billion in revenues to the world’s governments.


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