Transportation is basically a more fundamental economic activity for any business. It greatly contributes to the development of economic, political, social, and cultural fields and stirs up their condition. Generally, boat transport plays a vital role in business in many ways, which include:
Supplying of raw materials
The production of finished goods is usually dependent on the raw materials. Therefore, transportation aids in carrying of the necessary raw materials to the factories for production of goods that are ready for consumption.
Supplying of finished goods
Transportation provides the necessary service of linking a business to its suppliers and customers/consumers by moving the finished goods from the production site to locations where they are demanded. In fad, it creates time and place utility of goods by transporting them from one place to another. It easily carries the finished goods to the hands of the consumers to use them and significantly increase the aggregate sales of goods. As a matter of fad, transportation is such a key of marketing; helping in carrying the goods to the scattered consumers in various locations, narrowing the gap between consumers and producers.
The Dept of Transportation is responsible for regulations and compliance. The Maritime Administration (MARAD) is the Federal agency that provides assistance to the shipping public in locating U.S.-flag vessels for the carriage of both domestic and international cargo. To encourage a strong U.S. Merchant Marine for both national defense and economic security, the Jones Act
Transportation typically provides the mobility to labor and capital. In case more labor force is available at a particular place, transportation will help to carry it economically to a place it is needed. The transportation of labors from one place to another normally encourages the investment of labour and capital in more productive sectors.
The facility usually encourages division of labor and specialization on regional or geographical basis. In general, transportation costs highly affect localization of businesses. For instance, the production of goods may center at such place where the production cost is minimum. This ensures maximum utilization of the locally available resources possible.
Establishes relationship with foreign countries
Transportation helps in establishing stronger relationships with foreign countries; resulting in the sharing and widening of knowledge and skills in different sectors. Therefore, it helps to establish a social utility, uniformity and integrity, as well as strengthens national security.
Stabilization of Prices
Transportation helps in stabilizing of prices of different products. This is made possible by transporting goods from more supplied areas to scarcely supplied regions. In fad, this establishes coordination between demand and supply, thus stability in prices. Besides regularly supplying the necessary goods to the consumers, transportation also helps consumers to get necessary goods at lower prices, since it encourages competition among producers and suppliers; making mass production at lower cost.