Unit?One
Passage?1
?????The?physical?distribution?of?products?has?two?primary?aspects:?transportation?and?storage.?Both?aspects?are?highly?developed?and?specialized?phases?of?marketing.?The?costs?of?both?trans-porting?and?storing?are?built?into?the?prices?of?products.?Transportation?can?be?by?truck,?rail-
way,?ship,?or?barge.?For?some?items,?such?as?exotic?plants?and?flowers,?or?when?rapid?delivery?is?essential,?air?freight?may?be?used.
?????Storage,?or?warehousing,?is?a?necessary?function?because?production?and?consumption?of?goods?rarely?match:?items?generally?are?not?sold?as?quickly?as?they?are?made.?Inventories?build?up,?both?in?warehouses?and?at?retail?establishments,?before?the?foods?are?sold.?The?transporta-tion?function?is?involved?in?bringing?goods?to?a?warehouse?and?taking?them?from?it?to?retail?stores.
?????Storage?performs?the?service?of?stabilizing?market?price.?If,?for?example,?no?agricultural?product?could?be?stored,?all?food?would?have?to?be?put?on?the?market?immediately.?This?would,?of?course,?create?a?glut?and?lower?prices?drastically.?There?would?be?an?immediate?benefit?to?consumers,?but?in?the?long?run?they?would?suffer.?Farmers,?because?of?low?prices,?would?be?forced?off?the?land,?and?the?amount?of?food?produced?would?decrease.?This,?in?turn,?would?raise?consumer?prices.
?????Warehouses?for?storage?are?of?several?types.?Private?warehouses?are?owned?by?manufactur-ers.?Public?warehouses,?in?spite?of?their?name,?are?privately?owned?facilities,?but?they?are?in-dependent?of?manufacturer?ownership.?General-merchandise?warehouses?store?a?great?variety?of?products.?Cold-storage?warehouses?store?perishable?goods,?especially?food?products.?Grain?ele-vators?are?a?kind?of?warehouse?used?to?keep?wheat?and?other?grains?from?spoiling.?A?bonded?warehouse?is?one?that?stores?foods,?frequently?imported,?on?which?taxes?must?be?paid?before?they?are?sold.?Cigarettes?and?alcoholic?beverages?are?common?examples.
?????The?distribution?center?is?a?more?recently?developed?kind?of?warehouse.?Many?large?com-?panics?have?several?manufacturing?plants,?sometimes?located?outside?the?country.?Each?plant?does?not?make?every?company?product?but?specializes?in?one?or?more?of?them.?The?distribution?center?allows?a?manufacturer?to?bring?together?all?product?lines?in?one?place.?Its?purpose?is?to?minimize?storage?and?to?ease?the?flow?of?goods?from?manufacturers?to?retailers?rather?than?build?up?extensive?inventories.??It?reduces?costs?by?speeding?up?product?turnover.??Very?large?corporations?will?have?several?distribution?centers?regionally?or?internationally?based