Various functions of transportation in marketing goods
Various Functions and Benefits of Transportation in Marketing Goods
The entire economic, social and political life of a modern country depends upon an efficient system of transport. The benefits of transport can be studied under the following categories:
A. Economic Benefits/Functions: The economic effects of good transport facilities are as follows:
1. Extensive Market: Transport helps in the assembly of raw materials and distribution of finished goods. It makes it possible to move goods from the place of production to the place where they are to be consumed. In the earlier days, there were only local markets due to the absence of safe means of transport. Now-a-days, trade is not restricted to the boundaries of a nation, but has spread throughout the world.
Development of the efficient means of transport has knit together all the nations of the world into the one big world market. Even the perishable articles like fish, dairy products, meat etc. are being transported to distant places of the world. But for good transport facilities, such a development in trade and commerce would not have been possible.
2. Mobility of Labour and Capital: Transport reduces the rigours of immobility of certain factors of production. Mobility of labour and capital increases with the development of transport. An efficient network of transport services encourages the movement of people from one place to another.
Labour can migrate to the place where they can get better job opportunities, which reduces the exploitation of workers. The development of Australia and United States would not have been possible without immigrations from Europe. With the development of transport, the investment of capital is also channelised to new lands and other places of the world.
3. Specialization and Division of Labour: Transport helps each region and country to make optimum and efficient use of its national resources. Each region can concentrate on production of those goods for which its resources are best suited. Thus, movement of goods and people from one place to another leads to specialization and division of labour which results in minimum wastage of resources and reduction in the cost of production.
4. Economies of Large Scale Production: Transport has helped the development of large scale industries. It would not have been possible for these industries to procure raw materials, gather large number of workers and sell the finished goods, without the efficient facilities of transport. Thus, transport has made possible the various economies of large scale production which tend to reduce unit cost of production and help the economy.
Goods can be transported to places where there is scarcity and the prices are
5. Stability in Prices: Transport facilities iron out wild fluctuations. high from places where there is surplus and the prices are low. Such movement of goods helps in maintaining uniform prices throughout the country and further tends to equalize the prices of goods throughout the world.
6. Benefits to Consumers: Improved means of transport benefit the consumers in many ways. The consumers can enjoy the benefit of use of many goods, which cannot be produced at their place, by transporting such goods from other distant places. Further, it helps in reducing the cost of goods of consumers and increases their purchasing power.
7. Employment Opportunities and Increase in the National Income: The various means of transport provide employment to millions of people throughout the world. The economic development of a country depends upon the improved means of transport. Thus, transport contributes substantially to the national income of the nations.
8. Discouragement to Monopoly: The scope of total income is extended by the development of the means of transport. As commodities. can be quickly transported from one place to another, local producers cannot charge prices at their own will. This discourages monopoly and encourages competition.
9. Development of Agriculture : Transport has helped in the development of agriculture also. The business of agricultural products has grown to such a large extent only do to the efficient means of transport. It would not have been possible to use modern techniques of agriculture, improved quality of seeds and fertilizers, etc., but for good transport facilities.
10. Industrial Development: Transport facilitates the industrial development of a country. It helps the growth of industries by making available various factors of production. It would not have been possible to make such rapid industrial development without efficient means of transport.
11. Increase in National Wealth: Transport helps in increasing the national wealth of a country by facilitating agriculture, industry, trade and commerce.
B. Social Benefits/Functions :
Transport has substantially influenced the life of the people. The various social advantages of an efficient transport are as follows:
1. Discovery of New Lands: Transport has helped the discovery of new lands and the growth of cities and urban areas. Due to the availability of long distance cheap transport, land has been utilised to the maximum advantage the people all over the world. Even the waste lands are now being used. It also increases the value of land. We, generally, find the value of land, situated on the road side or near the railway station or bus stand, has increased manifold.
2. Diffusion of population: It reduces the concentration of population in the area of production. People can reach from distant places if there is an adequate and efficient system of transport.
3. High Standard of Living: Transport helps in the increase of production thereby raising the standard of living of the people. It is possible only through the means of transport that the ‘five M’s-men, material, money, machinery and management’ can be assembled at the place of production. So, industries depend upon efficient system of transport and it creates new industries.
C. Political Benefits/Functions: In addition to the economic and social advantages, transport enjoys a great political significance:
1. National Unity, Integration and Peace: Transport helps in maintaining internal peace and national unity of a country. It brings about national integration. A vast country like India cannot be held together without efficient means of transport. Transport encourages economic and political interdependence by promoting specialization and division of labour and this strengthens the need for unity and national integration.
2. National Defence: Transport is essential for strengthening the national defence of a country. In the days of war, it is only through improved means of transport that the defence personnel, material and equipment can be moved rapidly to the border areas. Defence of a country, therefore, necessitates the existence of improved transport facilities.
3. Political Awakening: Efficient means of transport help in creating political awakening in the people and the growth of civilization.
