The recommendations that have been given to 3 Gen Avion are likely to be effective due to a number of reasons. To begin with, the first suggestion that has been made proposes that the company needs to start assessing the cost it incurs for all its inbound shipments. This recommendation will indeed benefit the operations of 3 Gen Avion in a number of ways. For example, the company will obtain a good understanding of all the dynamics and factors that affect the costs it incurs when obtaining and shipping its products to its customers.
Some of the dynamics and factors that 3 Gen Avion will realize when it starts assessing its inbound shipping costs is the fact that its previous practice of carrying less than truckload goods has been a disadvantage to the company. The company has been facing this disadvantage because less than truckload shipments are more costly than truckload shipments. The recommendation that the company should start assessing its shipment costs will, therefore, improve the company’s welfare by reducing shipment costs. Reduction in shipment costs will be realized if the company ensures that most of its shipments are done in truckloads.
It has also been recommended that 3 Gen Avion should use the services of Yellow Freight as the main company that provides it with freight services. An analysis of the use of the Yellow Freight company as the main company that provides freight services reveals that 3 Gen Avion will be able to improve its welfare in a number of ways. For example, the use of Yellow Freight will have a significant effect of reducing the costs incurred by 3 Gen Avion when compensating customers for the loss incurred after a good was damaged during freight. This because Yellow Freight has a number of measures e.g. the use of a wrapping machine to reduce the likelihood of damage occurring to goods that are under freight.
Secondly, the use of Yellow Freight to provide shipping services will improve the welfare of the 3 Gen Avon company by increasing the company’s ability to communicate with customers. This is because Yellow Freight has the ability of monitoring the movement of of goods from the time they are obtained from suppliers to the time they reach their consumers. An improved level of monitoring the movement of goods will increase the capability of 3 Gen Avion to be aware of the occurrence of any damages on goods at any point of their transportation process. 3 Gen Avion has, therefore, been able to notify customers a short time after the damage of goods has occurred, thereby, keeping customers informed on the progress recorded in the transportation of their goods. The company has also been able to reduce the time it takes to compensate customers in case the company is responsible for any damages that are incurred by goods during transit as a result of increased monitoring.
3 Gen Avion has also been advised to use Yellow Freight to deliver all their inbound and outbound shipments. This is because the company’s welfare will be improved as a result of the reduction of costs that the company pays for freight. A decrease in freight costs will increase the 3 Gen Avions popularity. This can be explained by the fact that the company will be able to reduce their truckload transportation and fueling costs, thereby, increasing their shipping volume. The company will, therefore, be able to increase its competitiveness in the market by being able to charge lower prices for their services.
Reyes, S. (2012). Personal Communication. New York: Sage .