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Logistics Policy

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Logistics embraces the design&nbsp.of structures and policies, as well as decision-making dwelling on material and information,&nbsp. flows, fashioned at supporting and enhancing competitive advantage (Waters, 2003). Strategic decisions hinge on aspects such as warehouses, distribution centers, as well as transportation modes to be employed.

The logistics industry has undergone massive changes in recent decades, especially in areas of integration of information, transportation, inventory, warehousing, packaging, material handling, and security. it is no longer home-based and functions in a global market. The North America Free Trade Agreement involves U.S., Canada, and Mexico, and entails harmonization of the members’ logistics policies and procedures, as well as making logistics systems interoperable. The size of the U.S. economy and its geographical location have motivated the United States in taking a factual leadership position in matters regarding the facilitation of intermodal logistics and transport within the region, inclusive of cross-border facilitation.

The move towards a unified and interconnected modal system has been critical in the growth of logistics systems. Benefits arising from an integrated intermodal system include lower transport costs, lower environmental impact, enhanced national productivity, and efficiency. Intermodal transport and logistics are mainly driven by the industry via its search for low-cost solutions. Other factors playing a part include market deregulation and competition between shippers and carriers, which lead to a reduction in transport-related transaction costs for business (Murphy &amp. Wood, 2010).

The global sourcing of parts, goods and services, and raw materials have heightened the importance of logistic networks. Besides, trends towards internationalization and innovation have enhanced the need for organizations to be more alert and receptive to the contextual changes. The evolving trends in the creation of an international logistics hub demand the establishment of trends such as innovation, global integration, international investment and trade, and strategic business networks, as well as new physical and social technologies.