Shipping, Logistics & How Stuff Gets to You: Checkpoint 1

Quick checkpoint - five questions on logistics, containers, ports, chokepoints and inventory.

Question 1 of 5 Why did the shipping container cut the cost of trade so much?

Container ships were much faster than older ships Standard boxes could be moved between ships, trains and trucks without unpacking, slashing loading time and theft Containers were made of cheaper materials Governments banned other forms of shipping

Standardisation and fast handling, not speed at sea, drove the container revolution.

Question 2 of 5 Approximately what share of world trade by volume travels by sea?

About 10 percent About 30 percent About 80 percent 100 percent

UNCTAD estimates that around 80 percent of world trade by volume is carried by sea.

Question 3 of 5 What happened when the Ever Given blocked the Suez Canal in 2021?

Nothing, as ships easily took other routes Hundreds of ships queued and huge volumes of goods were held up for six days The canal closed permanently Oil prices fell to zero

The blockage held up billions of dollars of goods each day.

Question 4 of 5 What is the main weakness of just-in-time inventory?

It ties up too much money in stock It leaves little buffer if supplies are disrupted It requires huge warehouses It was never used by car makers

Lean inventories save money but leave companies exposed to shocks, as the 2021 chip shortage showed.

Question 5 of 5 What is the bullwhip effect?

Small changes in consumer demand turn into large swings in orders further up the supply chain A method of loading ships faster A tax on imported goods A type of delivery truck

Each business amplifies the signal it sees, so swings grow along the chain.

← Back to The Bullwhip Effect Next lesson → The Last Mile: Why Delivery to Your Door Is Expensive

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