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UNIT 1
Active vocabulary
to set up , , , ()
plant supervision
to extract ,
critical factor
global distribution network
facilities , ,
real estate
warehouse () ,
to contract for
life cycle
to commit 1) , (); 2)
; 3) , (., )
forwarder , -
hub , ,
Exercise 1. Read and translate the text.
Exercise 2. Answer the questions that follow.
Text 1
Factors of logistics
Part 1
Logistics is that part of the supply chain process that plans,
implements, and controls the efficient, effective forward and reverse
flow and storage of goods, services, and related information between
the point of origin and the point of consumption in order to meet
customers requirements. Industrial logistics is even more specialized
and touches a wide range of topics related to plant supervision, demand
planning, and production control.
4

Supply chain technology is a critical factor in extracting value. A

supply chain strategy is needed to spot the proper supply chain
technology. Selecting the right systems requires a careful evaluation
process that asks the right questions and spot proper solutions for
logistics and industrial logistics.
When you're setting up a global distribution network, the decision
on where to locate warehouses and how to operate them will be
governed by the following 10 factors.
1. Capital investment strategy is at the top of the list of reasons to
avoid owning foreign real estate. If it doesn't fit with the strategic goals
of the company, a foreign warehouse is not a likely investment. The
question you have to answer is- is this the best use of company capital?
That said, many firms will consider the investment in a physical
distribution network strategic to serving certain global markets.
Consumer products company Procter & Gamble Co. used to serve
the Mexico City market from a number of small, inadequate facilities
scattered around the region. AMB Properties developed a distribution
operation to consolidate the P&G operations into a single, modern
facility and, after contracting for the use of the facility for a few years,
P&G purchased the operation, according to Steve Callaway, senior vice
president with AMB Properties.
2. Market life cycle is another critical factor. At the early stages of
market development, flexibility can be crucial. Markets can develop
faster or slower than expected, and scalability can become an issue.
Property-developers and third-party providers often have multiple
facilities and can expand or contract distribution resources to meet
changing needs.
On the flip side, many companies in a more mature market situation
will want to control their assets/inventory more closely. Combining
issues of how company capital is committed in a country or region and
meeting customer service demands may dictate ownership over a
contract relationship.
3. Speed to market takes two forms entering the market and
serving the market. Contracting for an existing facility with at least the
minimum systems and a workforce can accelerate market entry or
expansion. Here, entrenched infrastructure is a plus. Operations in port
areas, near airports or in distribution hot spots may promise logistics
capabilities and access to developed transportation infrastructure. Those
properties may be difficult or expensive to own because the area is
already built up. Many ports and airports may also restrict land
ownership.
5

Carriers and forwarders with operations on-site at ports and airports

often expand to include distribution services. Schenker recently
announced a European Logistics Center in Germany that provides a
logistics warehouse for value-added services adjacent to its central hub.
Property on port grounds may be impossible to own. The only way
to have property in some ports, confirms Edgar Kasteel, vice president
of Holland International Distribution Council, is to rent it from the port.
Those highly desirable locations may be difficult to secure, but they do
offer proximity to transportation infrastructure.
Questions
What is supply chain technology needed for?
Why is capital investment strategy at the top of the list of reasons
to avoid owning foreign real estate?
What is market life cycle?
Part 2
Active Vocabulary
city pair ( , , , -)
allied services
4. Local infrastructure is an important factor in transportation
efficiency, but service frequency and lane balance also come into play.
Some operation bases, though centrally located, may not provide
adequate transportation service into the destination market, or the lane
balance can be so skewed it drives high rates. Beyond the presence of
good highways, rail or inland waterway infrastructure, it is important to
model the actual or anticipated distribution patterns down to city pairs
or lanes.
Pan-national distribution may not work from an existing national
distribution center. Lane balances and frequency of service come into
play, but licensing may also be a factor.
5. Obtaining proper bonds and licenses to receive and store goods
and certifying processes that subsequently move goods into another
country can be a complex process. Being an established, registered
company with ongoing operations in the country is a plus.
Entering a market for the first time, you may need to establish close
relationships with Customs and other officials until they become
6

comfortable with your operation. The process will flow more easily for
established companies, says Kasteel.
6. Local knowledge is critical to success in each of these areas.
Labor laws can differ significantly, as can local culture and customs.
This isn't always negative it can provide more flexibility as with the
Netherlands-where flex workers are common. The market for
temporary logistics workers has built up around the numerous
transportation and distribution operations in the region, providing a
ready supply of experienced, seasonal workers to handle peak demand.
7. Destination knowledge can be another local resource. Establishing pan-national operations demands some knowledge of the
complexities of the various destination markets, along with their
infrastructure and rules. Finding the right manager with knowledge in
all the proper end markets can be a challenge. Key global hubs often
have experienced managers working in the industry and certainly attract
third-party logistics providers (3PLs) and allied services which offer the
same capability.
Questions
Why is it difficult to own logistic facilities?
Why is local infrastructure an important factor in transportation efficiency?
What aspects of local and destination knowledge are critical to success in logistic process?
Part 3
Active Vocabulary
handling systems -
tenant , ,
on speculation 1) ; ; 2)
to diversify
ground lease
bias 1) , , ; 2) , ,
CEO (chief executive officer) (.,
-)
8. Handling systems are another important consideration.
Ownership may be the preferred strategy for highly automated or
7

proprietary systems. When the size of the investment inside the facility
rivals or exceeds the cost of the building itself, the risk may be too great
for a property developer or 3PL. The expertise required to manage and
operate the facility may also be so specialized that the combined effect
suggests ownership of the staff and the site. Shoe manufacturer Reebok
Ltd. made the decision to own its facility near the port of Rotterdam in
large part because it had invested more in the handling systems than the
building itself.
Property developers and third parties want a risk-based return on
their investment. A versatile layout with adequate ceiling height and
column spacing to accommodate various storage layouts, plenty of
dock doors and provisions for cross docking are lower risk. Dedicated,
highly automated systems are expensive to install and operate and may
be tenant-specific.
Many developing markets have inadequate distribution facilities.
Initial development may be focused on manufacturing, and those goods
may initially move into export markets. Companies entering those
markets may accept sub-par distribution facilities because that's all that
is available.
Many distribution centers or logistics parks are built on speculation,
explains AMB's Callaway. Without a specific tenant or strong local
demand, infrastructure may be slow to develop and it can be more desirable to allow for flexibility to move out of an available facility and
into a more modern, secure logistics park or consolidate smaller operations as new distribution centers are built.
9. Risk management for property developers means diversifying
into multiple markets. In areas like China, there has been little
speculative development, and existing facilities are poorly designed.
China restricts property ownership, and developers wishing to enter the
market can own a building but not the land. Instead, they hold a ground
lease.
With demand for distribution facilities on the rise, more developers
and third parties are building in China. But they must also weigh the
risk that those companies that rushed to the area to take advantage of
low-cost labor might pull out if their cost of distribution rises, lead
times remain long and service fails to improve. Add currency risks and
questions about political stability in developing areas like China and
Eastern Europe, and you may be more than willing to let them shoulder
that risk.
10. Unvoiced preference may be the most difficult factor to
consider in global operations (as in domestic site selection). The root
8

cause can be a bias that doesnt want to be spoken or it can be a

preference that is not apparent. Offer a location consultant the example
of a CEO who fought to keep a plant open in the city where his
daughter went to college and theyll respond with tales of the CEO who
influenced a siting decision because wife likes to shop in Paris, the
executive who honeymooned in London or a host of negative
experiences that color the decision process.
How a company enters a market may be as important as where it
goes. The answers arent necessarily found on a map. Flexibility to
change a decision clearly indicates caution and may support being a
tenant over becoming a landlord, at least in the beginning.
Questions
Why are handling systems important considerations?
What is logistics park?
What are initial developments focused on?
What does risk management mean ?
Why is unvoiced preference the most difficult factor to consider?
What influences a siting decision?
Exercise 3. Mark these statements T (true) or F (false) according to the information in the text.
1. Industrial logistics touches a wide range of topics related to plant
supervision, demand planning and production control.
2. Firms do not consider the investments in a physical distribution
network strategic to serving certain global markets.
3. Many companies want to control their assets / inventory more
closely.
4. Pan-national distribution may work from an existing national
distribution center.
5. Many developing markets have adequate distribution facilities.
6. Distribution centers or logistic parks are built on speculation.
7. China does not restrict property ownership.
8. Developers wishing to enter the market can own a building and
the land.
Exercise 4. Match these words as they occur in the text.
1) critical
strategy
2) chain
infrastructure
3) investment
factor
4) transportation
technology
5) logistics
distribution
9

6) pan-national
park
7) handling
developers
8) property
system
9) distribution
layouts
10) storage
centers
Exercise 5. Complete the sentences.
1. Many ports and airports may also restrict ownership.
2. The only way to have property in some ports is to from port.
3. developers and third parties want a risk-based return on
their investments.
4. Risk for property developers means diversifying into
multiple markets.
5. preference may be the most difficult factors to consider
in global operations.
6. Lane balances and frequency of service come into play but
may also be a factor.
7. Many firms will consider the investment in strategic to serving certain global markets.
8. Combining issues of how company capital is committed to a country
or region and meeting customer service demands may dictate.
over a contract relationship.
Exercise 6. Render the text using the words that follow.
: , ,

.
.
, .
( ) , ( ).
(RFID-).
.
10


:
, , .

. , , , .
Words to be used in rendering
control device
material flow
- distribution
computerized cotrol system
marks
- bar code
inventory accounting
data base
Exercise 7. Render the text using the words that follow.
, , ,
.
, ,
, .
,
, ,
- .

, , .
. ,
11


,
.

, ,
, .

.
.
Words to be used in rendering
end consumer
food stuffs
material resources
supplies
armament
data flow
commercial output
trucking

UNIT 2
Active vocabulary
investment
semi-trailer
cargo pallets
appropriate
excessive outlays
innvations
to facilitate ,
perquisite
to eliminate ,
12

Exercise 1. Read and translate the text.

Exercise 2. Answer the questions that follow.
Text 1
Transport Logistics
Part 1
Companies often waste lots of resources, not aware of the fact that
professionally developed logistics schemes could save them lots of
money for further investment into their business. A Russian factory had
packaging for its products delivered from Moscow in vehicles with
non-standard semi-trailer height. This was due to the technological peculiarities of the packaging manufacturer which stacked cargo pallets at
a height exceeding that of a standard semi-trailer.
On the one hand the manufacturers wish to increase the amount of
cargo carried by one vehicle seems fairly sensible. Yet the appropriate
kind of vehicles is quite scarce and expensive, greatlyincreasing transportation costs. How should these excessive outlays be avoided?
It took ATL a series of negotiations to convince the packaging
manufacturer to lower pallet height by removing one row of the goods,
thus enabling the use of much less costly standard vehicles. The amount
of cargo carried by one vehicle was decreased, yet the logistics costs
per production unit were also considerably lower.
The resulting economy amounted to an estimated $ 70,000, which
is quite substantial even for a large company. Most logistics schemes
currently employed by businesses nationwide may have disadvantages,
the removal of which is going to help optimize the functioning of logistics services and save considerable amounts of financial resources.
Talking about a COMPLEX of logistics services, we should mention one of innovations in this field, which indeed helps save customers money while facilitating the very logistics process for them.
Every business that has to do with transportation has logistics specialists among its staff. The company spends resources on such specialists
workplace, salary, social insurance and perquisites. A serious business
is impossible without such a specialist and large-scale companies have
more than one of those. How can a company make its logistics department work more effectively without spending much resource ?
An ATL employee is attached to the customer company to resolve
all logistics-related issues that may arise in the course of doing busi13

ness. He directly contacts the companys sales department, receives

information on products shipment, forms orders, manages loaders, and
executes overall management of the transportation process. Such
scheme helps cut down our customers expenses by eliminating the
need to pay salary to a special employee ATL does the job.
Taking into consideration the fact that average salary of a logistics
specialist is approximately $ 700 and the general practice of having at
least two such employees in a company, we arrive to a conclusion that
average annual economy amounts to $ 18,00020,000 minimum. So
why have one or more costly specialists on your payroll, when a professional logistics company is ready to provide all relevant services at a far
lower price?
Questions
What is the benefit of logistics schemes in transport ?
Why is the appropriate kind of vehicle quite scarce and expensive?
What can help to optimize the functioning of logistics services?
Why should transport companies have logistics specialists among
its staff ?
What is one of the innovations in the Complex of Logistics Services?
Part 2
Active vocabulary
motor trucking
long-and short-distance trucking

en route limitations
load capacity
rolling stock
railway transportation
Transport companies provide transportation of cargo on various
kinds of motor trucking. They can organize transportation of small and
oversized cargo on specially equipped vehicles.
In long- and short-distance motor trucking companies can offer:
commodity transportation from any region in the country, including towns where offices are located, without any en route limitations;
14

 long-term contractual relationships with over 400 Russian haulers

that meet the highest service quality standards and are reliable partners
from the point of view of cargo transportation security;
vehicle fleet: semitrailers /wagons with capacity of 14 to 120 cubic meters, payload capacity up to 25 tons special rolling stock: thermoses and refrigerator trucks with capacity of 60 to 82 cubic meters;
fitting vehicles with mobile communications equipment at customers request;
types of cargo and packing: all characteristics, including dangerous, big-volume and liquid cargoes; standard and non-standard packing.
The lines of activity in the field of International motor transportation:
arrangements of cargo transportation from any country in the
world in both import and export modes;
presence of long-term contractual relationships with more than
250 transport companies in the CTS and over 140 transport companies
in Europe, all of which meet the highest standards of service quality
and have proved to be reliable partners in regard of cargo transportation
security;
rolling stock;
semitrailers/ wagons with cargo volume of 68 to 120 cubic meters and capacity of up to 22 tons, special rolling stock: thermoses and
refrigerator trucks with capacity of 60 to 82 cubic meters;
sea containers of any standard , including high-cube;
all rolling stock is provided on CMR conditions
types of cargo and packing: all characteristics, including dangerous, big-volume
and liquid cargoes; standard and non-standard packing.
As for railway transportation companies offer a complete range of
services such as: calculating charges on privileged tariffs, cargo transportation across Russia and Europe with prearrangements with all railroad authorities, and cross-border forwarding services.
Their services are:
sending cargo from any region, in which the company has local
offices, in the shortest time possible;
provision of any kind of railway rolling stock;
en-route tracking of containers/cars with daily reports on
date/time of;
passing railway stations along the way;
provision of transit transportation and tariff payments through
countries of the CIS, the Baltic Sea, nd Europe.
15

Questions
What can offer a company in long-and short-distance motor trucking?
What can you tell about the vehicle fleet?
How many transport companies are there in the CTS?
What range of services do a company offer for railway transportation?
Part 3
Active vocabulary
door-to-door delivery
intermodal traffic (
)
marine traffic
route
Intermodal/ marine traffic
Door-to-door delivery using combinations of various kinds of
transport.
Working with it means:
cooperating with over 50 long-term partners(sea shipping organizations, seaport forwarders and terminals) in Great Britain, Finland,
Western Europe, South Africa, North and South America, Southeast
Asia and CIS countries;
choosing and developing optimal routes for transporting exported and imported cargoes;
precise coordination of activities among all participants of the
transportation chain;
coordination of traffic routes and transportation arrangements for
dangerous and off-clearance loads by marine and railway transport;
shortest delivery terms;
flawless observation of responsibility conditions during delivery
and acceptance en route;
freight forwarding services at border crosses within the CIS, including the provision of rolling stock and shifting the load from Sovietgauge railway cars to European-type cars.
16

Questions
What does door-to-door delivery mean?
Where are the main partners of door-to-door delivery situated?
Part 4
Active vocabulary
delivery term
terminal
cargo in bulk
collect order apiece
Terminals
Having concluded permanent long-term contracts with customs
terminals in St.Petersburg, Moscow, Finland and many cities of Russia
and Europe companies are ready to provide cargo storage, transfer and
consolidation services for further shipment to the final destination.
Transport companies provide the following services:
warehousing facilities, which meet quality and security standards
declared upon customers request in any country, of any type (from dry
to refrigerator type) without any time limitations;
independent warehouse bookkeeping of goods surpluses and
goods traffic by any boundary criteria;
drawing up documentation for cargo shipment and acceptance;
cargo acceptance in boxes and storage in bulk;
collecting orders apiece;
packing, marking and palleting of goods.
Use of air transportation in providing of business process continuity
will no doubt justify itself whether you call for speed. Transport companies specialize in cargo shipment by air.
Questions
What services do terminals provide?
When does air transportation justify itself?
Exercise 3. Mark these statements T (true) or (false) according
to the information in the text.
17

1. Companies provide transportation of cargo on various kinds of

motor trucking.
2. Companies cant organize transportation of small and oversized
cargo on specially equipped vehicles.
3. The appropriate kind of vehicle is quite cheap reducing transportation costs.
4. Most logistics schemes currently employed by businesses nationwide have no disadvantages.
5. The company spends resources on specialists workplace, salary,
social insurance.
6. The resulting economy amounted to an estimated $ 30,000 which
is quite substantial for a large company.
7. We arrive to a conclusion that average annual economy amounts
to $ 18,00020,000 minimum.
8. As for railway transportation the company cant offer a complete
range of services.
9. Door-to-door delivery means using combinations of various
kinds of transport.
Exercise 4. Match these words as they occur together in the
text.
1) technological
costs
2) cargo
schemes
3) transportation
resources
4) logistics
pallets
5) financial
economy
6) annual
peculiarities
7) commodity
trucking
8) motor
transportation
9) rolling
terms
10) delivery
stock
Exercise 5. Complete the sentences.
1. Transport companies provide . . . . . . . . . . . . traffic and cooperate
with many partners.
2. Transport logistics . . . . . . . . . . . . . observation of delivery terms.
3. Logistics is aimed to provide . . . . . . . . . . . . in long and short
distance trucking.
4. . . . . . . . . . . . . . . consists semitrailers, refrigerator trucks, sea
containers and others.
5. . . . . . . . . . . . . . . usually provide warehousing facilities, drawing
up documentation for cargo shipment, packing, marking and palleting
of goods.
18

6. Professionally developed could save companies lots of

money for further.into their business.
7. The manufacture s wish to increase the amount of
carried by one vehicle seems fairly sensible.
8. Every business that has to do with transportation has
. among its staff.
9. Door-to-door delivery uses.. of various kinds of transport.
10. Use of air transportation in providing of business process continuity will no doubt justify itself whether you call for.
Exercise 6. Render the text using the words that follow.
Text
Part 1


.
:
;
;
;
;
;
;
;
.
Words to be used in rendering
traffic, transportation
rolling stock
mode of transport
routing
insurance
19

Part 2

:
, ,
, , .

.
.
.
. , , . , , .
.

.
. .
. , , ,
.
.
. ,
.
.
. , .
,
:
20

 ;
;
.

Words to be used in rendering

motor trucking
railway transport
marine transport
inland water transport
airline traffic
Exercise 7 . Title each paragraph.

UNIT 3
Active vocabulary
personalized distribution
evaluation
digital
in a nutshell ,
relevant ,
expertise
innovation
application
Exercise 1. Read and translate the text.
Exercise 2. Answer the questions that follow.
Text 1
Information Logistics
The effective management of information and communication is a
key factor of success in todays information society. The volume of
data and the amount of information sources are increasing, information
is not available at the right places, and communication processes lack
the involvement of the right employees.
Information Logistics means applying the just-in-time philosophy
to the supply of information and communication. In a world where
people have to face the ever-rising flood of information, the market for
21

Information Logistics solutions is going to expand rapidly. Information

Logistics applications have a wide spectrum: Personalized distribution,
evaluation, and processing of information, support of business communication processes, mobile information via digital companions, personalized information services for customers and employees, locationindependent information chains and many more.
In a nutshell the philosophy of Information Logistics is: The right
information at the right time and place. The research of the Information Logistics Competence Center focuses on the following areas:
Smart Healthcare Solutions;
Smart Business Solutions;
Smart Living Solutions.
In these areas, the institute has two approaches: Digital Companions manage a needs-oriented information supply. A Digital Companion is software that supports users in their day-to-day activities and
provides them automatically and situation-dependent with relevant information.
Communic AID covers all Information Logistics aspects of communication.
Communic AID develops Information Logistics applications that
offer support in complex communication processes.
Information Logistics offers solutions for the optimization of inhouse communication. Due to the amount of incoming emails, important information is easily overlooked, work is interrupted more and
more frequently, and the quality of work is affected. Decision processes
become more complex and make more and more experts necessary.
Incoming calls require a lot of task switches and affect the employees
concentration. Problems of this kind have to be solved on technological, cultural and organizational level. With Communic AID business
the Fraunhofer ISST offers its expertise in improving communication
processes in organizations.
Information Logistics is innovative technology for the future world
of information. Only Information Logistics makes it possible to implement information just-in-time and optimize communication processes. The Information Logistics Competence Center was established in
1998 at the Fraunhofer ISST to strengthen the research and development activities in this area. The Fraunhofer ISST develops basic concepts for Information Logistics applicatios and puts them in practice. At
the same time the Information Logistics Competence Center is a think
tank with the objective of transforming innovations, in cooperation with
partners from industry, into marketable products.
22

Technology
development of Information Logistics applications and compo-

nents;
adaptation of Information Logistics modules to different IT infrastructures.

Business Development
development of business models;
technology calendars.

Networking
provision of benefits, potentials and technologies of Information
Logistics;
applications;
development of strategic partnership networks.

Questions
1. What is the key factor of success in todays information society?
2. What does Information Logistics mean?
3. Is the market for Information Logistics solutions going to expand
rapidly?
4. What is a spectrum of Information Logistics applications?
5. What is the philosophy of Information Logistics?
6. What are the two approaches of the institute?
7. What is a Digital Companion ?
8. What does Communic AID cover?
9. What does Information Logistics offer?
10. When was the Information Logistics Competence Center established ?
11. What is the purpose of this center?
12. What are the main directions of the Information Logistics Competence Center?
Exercise 3. Mark these statements T (true) or F (false) according to the information in the text.
1. The absence of the effective management of information and
communication is a key factor of success in information society.
23

2. Information Logistics means applying the just-in-time philosophy to the supply of information and communication.
3. The Information Logistics Competence Center has three approaches.
4. Information Logistics doesnt offer solutions for the optimization
of in-house communication.
5. With Communic AID business the Fraunhofer ISST offers its expertise in improving communication processes in organizations.
6. Information Logistics doesnt make it possible to implement information just-in-time.
7. The Information Logistics Competence Center is a think tank
with the objective of transforming innovations.
Exercise 4. Match the words as they occur together in the text.
1) effective
distribution
2) mobile
source
3) personalized
level
4) digital
processes
5) information
information
6) organizational
research
7) communication
products
8) to strengthen
companion
9) marketable
management
Exercise 5. Complete the sentences.
1. Information Logistics applicate personalized .,
and processing of information.
2. Infomation Logistics means the just-in-time philosophy to
the.of information and communication.
3. . The philosophy of Information Logistics is: The
right information at the right time and place.
4. Information Logistics offers solutions for . of in-house
Communication.
5. Only Information Logistics makes it possible to implement.just-in-time and optimize process
6. With Communic AID business the Fraunhofer ISST offers its
in improving communication processes in organizations.
7. The Fraunhofer ISST develops basic concepts for information
Logistics .. and puts them into practice.
8. Information Logistics is.. technology forn the future
world of information.
24

9. The Information Logistics Competence Center is a think tank

with the objective of transporting . In cooperation with partners from industry, into marketable products.
Exercise 6. Render the text using the words that follow.
Text
Part 1
-
, ,
, ,
.
:
, ;
;
;
(, , );
.

,
.
.
MPS (Master Planning Scheduling - ) :

;
( );
.
,


.
25

 SIC (Statistical Inventory Control ),

,
.
:
, . , .
Words to be used in rendering
supply
sale
delivery
accumulation
forming
provision
to evaluate
stocks
Part 2

, ,
; , .

MRP (Material Requirements Planning
), , - . MRP
, .
(
),
. ,
.

.
26

 ,
, .
, , , .
CRP (Capacity Requirement Planning
) .
, MRP CRP,
MRP II (Manufacturing Resource Planning
). (),

MRP II . MRP II , 16 , . General Motors ERP-,
, SAP R/3, BAAN,
Oracle Application
. : , , ,

, . .
.
MRP II ,
.
Words to be used in rendering
rigging
order
supplier
supplement
incoming
customer
27

Part 3
multi-sites, , , , , .

ERP (Entering Resource Planning ).
MRP II ERP
, ,
, /.

CSRP (Customer Synchronized Synchronized
Resource Planning , ),
. ,
(, , ). CSRP
. , ,
, ,
,
.
,
.
, ,
, , - . , - , , ,
()
().
28

Words to be used in rendering

obligation
pushing system
composition
list
distribution
market
Exercise 7. Title each paragraph.

UNIT 4
Active vocabulary
shift , ,
impact ,
emerge ,
involve ,
enhance , ,
tap ,
cooperative ,
consolidation
issue ,
critical ,
incorporate , ,
Exercise 1. Read and translate the text.
Exercise 2. Answer the questions that follow.
Text 1
The Need for Logistics Strategy
Your guide to logistics supply chain
There are many shifts and changes now occurring in the business
marketplace, all of which have either a direct or indirect impact on your
logistical operations. Some of these changes are related to changing
purchase channels and others relate to the impact of emerging technologies and industry initiatives.
29

The development and ongoing use of formal Logistics Strategy to

guide your operations through these items of change is now more important than ever. The process involved in the development of a Logistics Strategy also results in enhanced intra-company communications
and identifies potential areas of weakness and also untapped sources of
competitive advantage. Specifically, identification of potential cooperative supply chain initiatives (Competing Supply Chains) may be the key
to maintaining future competitiveness and solid client relationship.
With all the benefits to a formal Logistics Strategy, it is surprising
that surveys of senior logistics professionals identified that only 40 %
indeed had a formal Logistics Strategy in place.
But perhaps this is not as surprising as one might think. Indeed
faced with regional consolidations, resource and cost reduction plans,
day-to-day operating, customer issues and industry initiatives, the time
to perform the critical strategy task just is not available and many operating logistics professionals do not have a good understanding of the
Logistics Strategy process, components and methods.
Creating a powerful Logistics Strategy is somewhat of an art developed from a solid understanding of basic logistics, industry basic dynamics, current and emerging technologies and initiatives and most importantly, an understanding of your firms current and future goals
within the market. As well, all component areas of supply chain and
your operations must be analyzed and incorporated where appropriate
to harness the greatest potential for cost benefits, competitive advantage
and customer service. Customer service requirements need to be set
within the goals of the firm as a starting point for the strategy process.
The component areas of a complete Logistics Strategy should include:
Vision Development;
Transportation;
Outsourcing;
Logistics Systems;
Competitors;
Human Resources;
Network Design;
Supply Chain;
Information;
Options Analysis;
Strategy Review;
Communications.
30

Questions
What can influence logistical operations?
What can maintain your future success?
What are formal figures for Logistics Strategy being used? What
are the reasons for that?
What are the most important points to be studied to create a powerful Logistics Strategy?
What shall be taken as a starting point for the strategy process?
Can you name the main areas of a complete Logistics Strategy?
Why do you think these components are as important for LS?
Exercise 3. Match these words as they occur together in the
text.
1) intra-company
competitiveness
2) supply
task
3) cooperative
benefits
4) untapped
sources
5) competitive
point
6) maintain
communications
7) client
relationship
8) critical
chains
9) cost
supply chains
10) starting
advantage
Exercise 4. Mark the sentences T (true) or F (false) according to
the information given in the text.
1. Changes now occurring in business have either direct or indirect
impact on your logistical operations.
2. Logistics Strategy results in enhanced intra-company communications and depend on sources of competitive advantage.
3. Most of logistics companies have their own LS.
4. It takes time to form a powerful LS.
5. Customer service requirements must coincide with the targets of
the firms as a starting point for the strategy process.
Exercise 5. Render the text using the words that follow.
Part 1
(logistical operations)
,
/ .
31


( ) (
). (
,
.). , ,
, - , .
,
,
. .
(logistical chain)
/
(
),
.
.
(cooperative supply chain)

-
.
.
Words to be used in rendering
to furnish
, to pick
internal inventory transfer
raw material
semifinished products
losses
material flow
information flow
supplier
consumer
32

UNIT 5
Active vocabulary
practitioner
devise
refer to , -,
endorse
Exercise 1. Read and translate the text.
Exercise 2. Answer the questions that follow.
Text
Understanding Incoterms
Incoterms are international rules that are accepted by governments,
legal authorities and practitioners worldwide for the interpretation of
most commonly used terms in international trade. They are standard
trade definitions in international sales contracts. They either reduce or
remove altogether uncertainties arising from differing interpretations of
such terms in different countries. Devised and published by the International Chamber of Commerce (ICC), they are at the heart of world trade.
The scope of Incoterms is limited to matters relating to the rights
and obligations of the parties to the contract of sale with respect to the
delivery of goods sold, but excluding intangibles like computer software.
Each Incoterm is referred to by a three-letter abbreviation. Among
the best known Incoterms are EXW (Ex works), FOB (Free on Board),
CIF (Cost. Insurance and Freight), DDU (Delivered Duty Unpaid), and
CPT (Carriage Paid To). Incoterms groups the terms in four categories
denoted by the first letter in three-letter abbreviation. All terms list the
sellers and buyers obligations.
Under the E-term (EXW), the seller only makes the goods available to the buyer at the sellers own premises. It is the only one of that
category.
Under the F-terms (FSA, FAS, FOB), the seller is called upon to
deliver the goods to a carrier appointed by the buyer.
Under the C-terms (CFR, CIF, CPT, CIP), the seller has to contract for carriage, but assuming the risk of loss or damage to the goods
or additional costs due to events occurring after shipment or dispatch.
33

Under the D-terms (DAF, DES, DEQ, DDU, DDP), the seller has
to bear all costs and risks needed to bring the goods to the place of destination.
ICC introduced the first version of Incoterms short for International Commercial Terms in 1936. Since then, ICC expert lawyers
and trade practitioners have updated it six times to keep pace with the
development of international trade. The main reason is the need to
adapt Incoterms to contemporary commercial practice.
Most contracts made after 1 January 2000 will refer to the latest
edition of Incoterms, which came into force on that date. The correct
reference is to Incoterms 2000. Unless the parties decide otherwise,
earlier versions of Incoterms like Incoterms 1990 are still binding if
incorporated in contracts that are unfulfilled and date from before 1
January 2000.
Versions of Incoterms preceding the 2000 edition may still be incorporated into future contracts if the parties so agree. However, this
course is not recommended because the latest version is designed to
bring Incoterms into line with the latest developments in commercial
practice.
The English text is the original and official version of Incoterms
2000, which have been endorsed by the United Nations Commission on
International Trade Law (UNCITRAL). Authorized translations into 31
languages are available from ICC national committees.
ICC now publishes a brief introduction to Incoterms on a new special section of its website. The section does not provide all the answers
but will help understanding of what Incoterms are and how they are
organized. As the guardian and originator of Incoterms, ICC has a responsibility to consult regularly all parties interested in international
trade to keep Incoterms relevant, efficient and up-to-date. This is a long
and costly process for ICC, which is a non-governmental, self-financed
organization. The work is financed out of sales of Incoterms 2000 and
related publications, which are protected by copyright.
Questions
What are INCOTERMS?
Why do practitioners worldwide need Incoterms?
What do they cover?
What terms and conditions of delivery do you know?
When were International Commercial Terms first introduced and
why?
34

Why do Incoterms need revising periodically?

What is the latest version of Incoterms?
Can the earlier versions be referred to?
Which organizations devised and endorsed Incoterms?
What is ICC responsible for?
Where can you find complete information on Incoterms?
Exercise 3. Match these words as they occur together in the text.
1. Legal
by copyright
2. International
relevant
3. Remove
organization
4. Assume
all costs and risks
5. Bear
the risk of loss
6. To keep
trade
7. Self-financial
uncertainties
8. To be protected
authorities
Study the table and explain why you find the information useful.
Table 1
THE 13 INCOTERMS
MODE OF TRANSPORT AND THE APPROPRIATE INCOTERM 2000
ANY MODE OF TRANSPORT INCLUDING MULTIMODAL
EXW
EX Works / named place
FCA
Free Carrier / named place
CPT
Carriage Paid To / named place of destination
CIP
Carriage and Insurance Paid To
DAF
Delivered at Frontier / named place
DDU
Delivery Duty Unpaid / named place of destination
DDP
Delivery Duty Paid / named place of destination
AIR TRANSPORT, RAIL TRANSPORT
FCA
Free Carrier / named place
SEA AND INLAND WATERWAY TRANSPORT
FAS
Free Alongside Ship / named place of shipment
FOB
Free on Board / named place of shipment
CFR
Cost and Fright / named port of destination
CIF
Cost, Insurance Fright / named port of destination
DES
Delivered Ex Ship / named port of destination
DEQ
Delivered Ex Quay / named port of destination
35

Exercise 4. Render the text using the words that follow.

1. , , , , , ,
.
2. Delivery Duty Unpaid (DDU) , , .
,
( , , ),
. ,
, .
3. Cost, Insurance, Fright (CIF) , , ,
. , .
4. Free On Board (FOB) ,
, . ,
/ .
5. Ex Works (EXW) ,
, , . . , , . . , , , , .
,
. .
Words to be used in rendering
interpritation
definition
uncertainties
36

 fulfil obligations
taxes and duties
losses and risks
Exercise 5. Analyze the above information and discuss the topics.
1. Which conditions do you consider most favorable for a buyer?
2. If you were a supplier which conditions would you prefer and
why?
3. Imagine you are displaying your products at an international fair.
Which prices would you quote to your potential clients?

UNIT 6
Active vocabulary
on the one part / on the other part /
refer to
in accordance with / in conformity with
terms and conditions of the contract
at / without/ smbs consent /
to take into account
without extra charges
to be evidenced by
manufacturing works -
to issue a certificate
letter of Guarantee
shortage of goods
in case of
case ,
to bear responsibility
receipt ,
execution of the contract
defective / faulty goods
Exercise 1. Read and translate the text.
Exercise 2. Answer the questions that follow.
37

Text 1
Contract
Part 1
Hereinafter referred to as the Seller, on the one part, and hereinafter
referred to as the Buyer, on the other part, have oncluded the present
Contract as follows:
1. SUBJECT OF THE CONTRACT
The Sellers have sold and the Buyers have bought on the FOB
terms the goods in accordance with the Specifications attached to the
present Contract and forming integral part thereof.
2. PRICE AND TOTAL AMOUNT OF THE CONTRACT
Prices for the goods are fixed in USD. The total amount of the present Contract comprises 3,000.00 USD.
3. TIME AND DATE OF DELIVERY
The goods are to be delivered in the time stipulated in the Specifications attached to the Contract. The date of 5 May, 2007 is to be considered as the date of delivery.
4. QUALITY
The quality of goods is to be in conformity with the requirements
given in Specifications. The goods are to be of the latest design and
manufactured of the first grade materials. The quality of the goods is to
be evidenced by a Certificate of Quality issued by the manufacturing
works or by a Letter of Guarantee of the Sellers.
5. PACKING AND MARKING
Packing should protect the cargo from any damage, corrosion and
shortage during transportation by all kinds of transport. Each case is to
contain a Packing List indicating the denomination of goods, Contract
No., Case No., Item No. as per Specification, Net and Gross weight.
Packing Lists are to be inserted in each case in a waterproof envelope.The following marking is to be made in waterproof black paint on
each case in Russian and English: Top, With Care, Contract No., Case
No., Gross/Net weight, Size of the case (length, width, height in cm).
The Sellers are to bear responsibility for all eventual losses and/or damages caused by inadequate or unsuitable packing and marking.
38

6. PAYMENT
Payment is to be effected in USD within 5 days after receipt by the
Buyers through the GUTABANK, Moscow, of the following documents:
Invoice in quadruplicate;
Full set of clean on board Bills of Lading (or airway bill, or railway bill) issued in the name of the Buyers;
Certificate of Quality of manufacturing works or Letter of Guarantee of the Sellers;
Case per case Specification or packing list in duplicate;
Bank charges connected with collection of documents are to be
for the Sellers account.
7. INSPECTION AND TESTS
The Buyers have the right to send their inspectors to the manufacturing plant in the Sellers country to participate in the inspection and
tests of the goods. The participation of Buyers inspectors does not free
the Sellers from the liability provided for in the Clause Guarantee of
the present Contract. The final inspection is to be effected in RF.
Questions
What are the parties to the Contract?
What kind of Contract is it?
What is the difference between the terms:
price and amount;
time and date of the Contract? (Clauses 2 and 3.)
What will be your packing requirements? (Clause 5.)
What kind of packing is needed to avoid corrosion?
Which documents are to be submitted to the Buyers before payment
is effected? (Clause 6.)
How can the Buyers participate in inspection and tests of products?
(Clause 7.)
Part 2
Active vocabulary
delay in delivery
at the sellers/buyers option /
at smbs expense -
to participate/participation/participant
39

to extend the period

prohibit/prohibition
to advise
to remain in force
beginning and cessation
to prevent from
null and void
valid
duly authorized
o assign the rights
on behalf of
8. GUARANTEE AND CLAIMS
The Sellers guarantee that the quality of goods conform to the requirements of the Contract and in particular guarantee that the goods
have been delivered complete with all necessary accessories in strict
accordance with the terms and conditions of the Contract so that to ensure their normal and uninterrupted operation.The guarantee period is
12 month from the date of putting the equipment into operation, but not
more than 15 months from the date of shipment. Should the goods
prove to be defective the Sellers undertake, at the Buyers option, to
eliminate the defects or replace the faulty goods free of charge and
without delay, the cost of transportation and insurance being at the
Sellers expense. Any claims, if any, are to be presented by the Buyers
not later than 30 days after the date of expiration of the guarantee period. Survey reports made out with participation of experts of the RF
Chamber of Commerce will serve sufficient proof of a claim.
9. FORCE MAJEURE
Should any circumstances arise preventing any of the parties to fulfill their obligations partially or in full, namely acts of elements, war,
military operations, blockades, prohibitions of exports or imports, the
time of delivery under the Contract is to be extended for the period
equal to that during which such circumstances will remain in force. The
Sellers are to immediately advise the Buyer of the beginning and cessation of the above circumstances.
10. PENALTY
If the Sellers fail to deliver the goods in the time stipulated by the
Contract they are to pay a penalty at the rate of 3 % of the value of the
goods delayed. However the total sum of the penalty is not to exceed
20 % of the value of the goods delayed. Should a delay exceed 3
months the Buyers have the right to cancel the Contract.
40

11. ARBITRATION
Any disputes which may arise under or in connection with the Contract are to be submitted, without recourse to the courts of law, to arbitration in London, England, in accordance with the rules of International Chamber of Commerce.
12. OTHER TERMS AND CONDITIONS
After this Contract has been signed all and any previous negotiations and correspondence pertaining thereto to be considered null and
void. All amendments and additions are to be valid only if made in
writing and signed by duly authorized representatives of both parties.
Neither of the parties has the right to assign their rights and obligations
to any third party without written consent of the other party. Moscow is
considered the place of the conclusion of this Contract.
13. LEGAL ADDRESSES OF THE PARTIES
ON BEHALF OF THE SELLERS
ON BEHALF OF THE BUYERS
Questions
What would you do to protect yourself against the risk to receive
defective goods? (Clause 8.)
What is considered to be Force Majeure circumstances? (Clause 9.)
Do you consider Clause 10 of the Contract important? Why?
Which organizations will you choose to settle your problems (if
there are any)? (Clause 10.)
Where is the critical point of responsibility transferred from the
Sellers to the Buyers?
Topical vocabulary to the contract making.
Imagine you are planning to purchase some products. Discuss
the deal with your supplier using the words bellow.
INQUIRY and OFFER
be in the market for
be in the market with
contact smb - (get in touch with)
introduce goods
trial order
41

make an offer for

offer for consideration
send out inquiries
place an order
volume of an order
withdraw an order
You have agreed about quantity and denomination of the order.
Try to agree to the best possible prices and the most favourable
payment conditions.
CONTRACT
appendix ces
contract form
draft contract
supplement (addendum, addenda pl)
supplier (subsupplier, subcontractor) ()
terms and conditions
validity
valid up to ()
wording of the contract
PRICES
agreed price
(non-) competitive ()
current
dumping
fair
fluctuating
finalized
low
nominal
original
purchase
(un)reasonable , ()
retail
reduced
selling
stable
wholesale
world
42

DELIVERY
accept delivery
deliver goods at the address of goods in
the time stipulated in the contract ,
ensure delivery
maintain the contract delivery date
make delivery (dispatch) ,
PAYMENT
deduction ,
drawer (, )
transferable letter of credit
method of payment
open account
outstanding invoice
payment for collection
payment by drafts
payment by mail remittance
payment order
Choose the way of transportation and discuss the way of packing and insurance of the goods.
PACKING and MARKING
case
crate
packing :
outside
seaworthy
waterproof
pallet ,
fire-proof
fragile ()
inflammable ,
keep dry
open here
protect from cold (heat) ()
this side up
top, do not turn over ,
use no oil
43

INSURANCE
insure against :
all risks
breakage
burglary
failure (when equipment fail to operate after delivery)
fire
leakage
natural disasters
war risks
water damage
insurance cover
aviation
goods-in-transit
marine
warehouse-to-warehouse
TRANSPORT
booking
berthing place
bonded warehouse
cargo-handling equipment -
cargo-capacity
cargo-plan
carriage by sea
chartering ( )
collect fright
consignee (receiver)
consolidation of shipments
container carrier
container terminal
contents of a container
dead weight
detention
deviation
dispatch , (
)
forwarding agent
(20,40)footers 20/40-
44

port dues
rate of natural loss
reroute
shipper
shipping documents
surveyor
You have received faulty goods.Try to settle the problem amicably.
CLAIMS
laim ,
admit
reject
withdraw
counter claim
damage to smth
defective/faulty (goods)
dispute
documentary evidence
failure ,
missing goods
report ,
examination claim
experts claim
inspection claim
surveyors claim
Discuss with your partner variants of merging. Write a Protocol of Intent of setting up a new JV.
PATTERNS OF TRADE
agreement :
bilateral
intergovernmental
interstate
multilateral
amalgamation
association ,
branch
entity
free economic zone
45

export-oriented
injection (of capital/cash)
merger
JOINT VENTURE
allocation of profits
charter fund
contribution in (money, cash)
exemption period
fiscal obligations
founders
fund :
currency
depreciation
special purpose
for material incentive
letter of intent
legal entity
liability limits
liquidation procedures
registration regulations
repatriate a return of ones investments

tax on profit
tax-free
taxation
tax collection
ACCOUNTING
accountant
accounting (accountancy) ,
accounting period
accounts payable
accounts receivable
accrue (-ed dividends, liabilities)
assets ()
auditor -
balance sheet ()
bonded debt
capital stock
46

capital stock issued ,

cost price
current assets
current liabilities ,

debit
debtors
defer ,
deferred income
depreciation
discount
earnings
expenditures
fiscal year
gross profit
holding company
income tax
indebtedness
installment
intangibles
inventories -
maintenance costs
manufacturing costs
mortgage ,
net :
weight
profit
assets
earning
loss
nominal capital
overhead expenses
overdraft ,
real estate
revenue
share capital
stockholder (shareholder)
(in)tangible assets ()
turnover
47

undistributed profit
valuation ,
wear and tear
EXCHANGE
bear ( )
bull ( )
dealer ( )
floor broker ( )
floor trader ( )
futures

What is marketing? Try to find a niche for your newly developed product.
MARKETING
adaptation of a product to a market
buying decision -
competitive environment
competitive parity
consumer protection
customer orientation
demand
create demand for a new product
stimulate demand
durect access to a market
direct-to-home re-tailing
forecasting
lead time
life expectancy
limit of demand
market
create a market of a product
market conditions
needs
penetration
research
size
domestic (home)
48

buyers
leave a niche open
leave a niche for outsider
marketing:
objectives ,
philosophy
structure
strategy
direct marketing
markdown
markup
merchandising
negotiated prices
parity goods
payback period
planning :
long-range ( 5 15 )
medium-range ( 2 5)
short-range ( 1 )
price above (below) the market ()
flexible pricing
PRODUCT
generic ,
intangible
tangible
unique
product development
product lifecycle
product lines strengths and weaknesses

product promotion
product switching ,
SALES
outlets
forces
support
share of the market
shelf-placement
49

substitute
trend
user market
variety shops
vending machines
withdrawal of the product off the line (discontinuation)

50


.. . ., 2002.
.. . ., 2001.
.., .., .. . 2005.
.. . Te . ., 1995.
.. . 100 . .; /, 2005.

CONTENTS
................................................................................................
Unit 1 .............................................................................................................
Unit 2 .............................................................................................................
Unit 3 .............................................................................................................
Unit 4 .............................................................................................................
Unit 5 .............................................................................................................
Unit 6 .............................................................................................................
......................................................................................

3
4
12
21
29
33
37
50

51

..
..
08.12.2009. 6084/16. .
. . . 3,02. .-. . 2,75. 300 . . 59.

. ..
. ..
105005, , 2- , 5