The goal of any organization is to ensure that its product reaches the consumers in time to increase its sales. There are various modes of transportation depending on several factors such as the type of product, consumers’ distance, and the agency of the product. The following discussion indulges in pipeline product transportation to establish the advantages and limitations of this type of transportation. In addition, the paper analyzes three companies that are involved in the pipeline business to establish their mission.
Advantages of Pipeline Transport System
The pipeline transport system has the following advantages: first, it is a safer and reliable method of transportation than road transport. Pipeline transport is safer than the road because it reduces the chances of accidents (Coyle, 2011). Road distribution channels are prone to accidents due to the high number of road users and driver errors that may result in product damages, hence, resulting in losses and time delays of the product. The second benefit is that it is cost-effective. Pipeline transport is cheaper compared to air transport; hence, a business can incur less cost of production (Hull, 2010). The last advantage of pipeline transport is that it has little transit loss. Transit loss occurs due to product damages and delays during transportation, which increases the cost of doing business (Coyle, 2011).
Disadvantages of Pipeline Transport
The following are the main disadvantages of pipeline transport as a distribution channel. First, it is hard to transport some solid products through the pipeline. Therefore, businesses that manufacture solid goods have to use other forms of transportation. Finally, the initial cost of building a pipeline transport system is high; hence not all companies can manage to construct it due to capital limitations (Monczka, Handfield, Guinipero, Patterson, & Waters, 2010)
Three Major Companies in the Pipeline Industry
The first is Koch Pipeline Company, which is based in the United States. It offers pipeline transportation for businesses by ensuring safety, efficiency, and timely delivery of products. The company website is www.kochpipeline.com. Koch Pipeline Company has built an elaborate pipeline system to ensure that it meets the customers’ needs. The company’s mission is to improve its present value, which will in turn increase future profits. By doing so the company hopes to provide a secure transport system, offer the opportunity for growth for all the stakeholders, and improve the employees’ welfare. It seeks to achieve this by creating a competitive advantage.
Driver Pipeline Company (www.driverpipeline.com) is another major player in the pipeline industry. The company is based in the U.S.; its headquarters is in Dallas. Drivers Pipeline Company’s mission is to determine and fulfill the clients’ needs and expectations for quality and efficient construction and service.
Finally, the third company is Magellan Pipeline Company (www.magellanlp.com), which provides petroleum products transportation through the pipeline across the states. Its mission is to ensure timely and efficient delivery of products through safer and environmentally friendly means. It seeks to achieve this by providing services that match the customers’ needs and expectations.
All the above companies offer pipeline transport for businesses across the U.S. their mission statement shows their dedication to providing these services in an efficient and timely manner that will not inconvenience their clients. In addition, the businesses seek to ensure that they achieve their goals while observing the environmental laws and regulations set by the authority.
In conclusion, a company needs to have an elaborate distribution channel that will ensure the safety and timely delivery of goods to the client. By selecting a safe and economic channel of distribution, companies ensure that they have incurred a minimum cost of distribution since, product damages chances are minimal, and the cost of transportation is less compared to road transport.
Coyle, J. J. (2011). Transportation: A supply chain perspective. Australia: South- Western Cengage Learning.
Hull, B. (2010). Oil Pipeline Markets and Operations. Journal Of The Transportation Research Forum, 44(2).
Monczka, R. M., Handfield, R. B., Guinipero, L. C., Patterson, J. L., & Waters, D. (2010). Purchasing & supply chain management. Hampshire: Cengage Learning EMEA.