Please describe a transaction channel as part of the logistics channels.

The transaction channel is that part of the logistics channel management that deals with when, where, and how goods, and their ownership is transferred.

The management of this is required to ensure that the buyer (importer) protects their financial interests and reduce risk. These risks could be no delivery of products after payment is made, or that the products are low quality or that the products might arrive damaged.

The seller (exporter) must also ensure that they are able to perform beyond the basics of product quality, price, and quantity. In global transactions, it is also important to clarify the location and point in time at which legal title for the goods transfers from the exporter to the importer.

When transfer of title occurs is important. Once that transfer occurs responsibility shifts. These responsibilities include making key decisions regarding mode and carrier selection, insurance coverage, carrying costs and routing. The transfer of ownership also determines who is responsible for payment of transportation services, insurance, and import duties. Finally, ownership determines responsibility for compliance with government regulations, management of the goods while in transit, and financial liability in the event of freight damage, loss, or delay.