Handbook of Global Logistics

China is undergoing exciting economic changes. Many of these will impact, or are impacted by, Logistics. In this paper, we summarize the current status of Chinese Logistics. We discuss issues related to the various transport modes: water, rail, road, air and intermodal, and their use by firms and by 3PLs (third party logistics providers). Two case studies are presented. Possible paths are formulated for the future development of Logistics in China.

Electronic Procurement Systems (EPS) are being acknowledged by researchers as promising technological enablers for achieving a responsive supply chain, and thereby, for gaining a competitive advantage in today’s global marketplace. A number of empirical studies have focused on the adoption of EPS in different countries. There is, however, a scarcity of work related to EPS adoption in India, even though information technology and the Internet play a significant role in that country. To fill this gap, we first discuss the potential supply chain benefits of EPS, especially as they relate to large multinational companies. Then, we specifically consider the Indian context. We highlight several firms whose innovative logistics operations permit the respective supply chains to function, uniquely blending Indian customs with modern business practices. We report on an empirical survey, as well as three case-studies relating to the importance and impact of EPS adoption in India.

We compare trends in the use of 3PLs (Third Party Logistics Providers) in the Asia-Pacific region, mostly among four countries: Australia, India, Malaysia, Singapore. These comparisons are based upon published results and surveys by us and by other researchers. The enhanced use of outsourcing is related to the growth of Manufacturing and Logistics in the Asia-Pacific. Another important factor is the skills required of Logistics managers. Those necessary competencies are detailed, with particular emphasis on China and Australia.

Traders in the Greater Mekong Sub-region (GMS) require efficient logistics services that can move their goods to the proper place, at the promised time, in the right condition, and at a suitable price. The GMS in Southeast Asia is composed of Cambodia, Lao People’s Democratic Republic, Myanmar, Thailand, Vietnam, as well as Yunnan Province and the Guangxi Zhuang Autonomous Region of the People’s Republic of China. It is, therefore, of great importance that regional linkages among neighbouring countries be enhanced, in order to facilitate trade and develop logistics for better access to the “global” market. The purpose of this chapter is to provide a description and rating of the GMS logistics system. The Greater Mekong Sub-region has focused on an “economic corridor” approach to economic integration; assessment of the logistics performance of these corridors is thus needed. Even though there is a GMS agreement that was ratified to facilitate the crossing of borders, it was still observed during our study that the weakest links in the various economic corridors remain the border crossings.

This chapter describes the application of linear programming techniques to the automatic planning of manufacturing and distribution decisions at the main sugar producer in Argentina. We summarize the production and logistics chain for the sugar business of this company, and present a linear programming model representing the key planning decisions within these processes. We provide details on the implementation of a software tool for managing the data, solving the model, and analyzing the results. That software tool and embedded model allowed the sugar planning team to improve the planning decisions by having a global comprehension of a very complex decision structure and analyzing multiple scenarios. At the same time, the team obtained a better understanding of the limits and potential of the available industrial and logistical facilities.

This chapter concerns the integration of liner container shipping and short sea service (cabotage) in Brazil. The methodology is based on a linear programming model, which maximizes the gross contribution margin and evaluates the consequences of mixing international and domestic loads. Firstly, the text presents an overview of Brazilian cabotage. Then the problem and the model are presented. The method is applied to a real case, where through sensitivity analysis, impacts on the performance of a liner company are measured. Thus, different scenarios are compared using a set of key performance indicators. The results show that this integration is quite attractive, and they also provide the shipping company with a solid background to support strategic and operational decisions.

This article aims to classify and critique the research and applications that have been conducted concerning supply chain management and logistics in Latin America. We assess the countries in Central and South America according to their capabilities in transportation infrastructure and various demographic and economic characteristics. A third objective is to identify additional research opportunities.

Use of a variety of scientific databases covering major journals in logistics, supply chain management, transportation, and the management sciences led to an original list of 250 references. That was reduced to about 90, the great majority from 1997 onward. These were appraised and categorized along multiple dimensions.

While the countries in Latin America are quite diverse, and a number of impediments to logistics exist, various regional trading blocs are facilitating progress in supply chains there. Five “lessons for business decisions” are emphasized which will aid companies that operate within, or may become part of, a Latin American supply chain. Moreover, summaries of the pertinent facts and country characteristics on infrastructure, trade, etc. enable us to identify top-performing nations as possible points of strategic entry, for a global firm wishing to conduct operations in Central America or in South America. Finally, several Propositions on Latin American logistics are formulated and proposed for future empirical testing.

Much has been documented about the logistical efficiencies created in the traditional European trade corridors. Those corridors, spanning countries like the UK, the Netherlands, Germany, France, Italy and Spain, thereby create an important economic region of its own. This is, however, to the detriment of the informational content of decision making on site selection. It is also to the disadvantage of other important regions that offer unique competitive advantages to foreign firms trying to base their value proposition on location in the sub-continent, especially those regions that have not yet matured in their place-branding initiative. The Oresund region is one such logistics hotspot in Scandinavia, where “Oresund” is the name of the narrow strait between the eastern part of Denmark and Southern Sweden. The two countries have been connected via ferries for centuries, but economic integration activities really took off when the fixed link (bridge and tunnel) was established in 2000. The Oresund region not only performs the important logistical function of connection and coordination between mainland Europe, the Baltic states and some important parts of Central Europe—it also makes a good logistical location for firms that target emerging consumer needs around sustainability, green supply chain management, and macroeconomic competence and stability. This chapter describes the potential offered by the Oresund region by charting its development, documenting those of its main features related to logistics infrastructure and practices, and tracking its performance on all major levels of logistics decision categories.

It is uncommon that country pairs would be directly connected by shipping services. The concept of “intermediacy” is thus important in regional or global freight distribution, as it addresses a whole range of network structures and nodes using to connect different market scales. In this chapter, the comparative intermediacy of transport nodes in Europe and North America is assessed over intermodal rail transport, and especially in container shipping. The respective cases of gateways, gateway port systems, and coastal and inland waterways are discussed. Each exemplifies a particular dimension of the intermediacy and freight regionalism that distinguishes North America and Europe.

In this chapter, we consider a network redesign problem that contains decision problems of opening new malt plants and breweries in order to increase the malt and beer production capacities of a Turkish corporation, Efes Beverage Group. We briefly discuss several beer logistics applications in Turkey and other countries, and some location applications in Turkey. Some attention is also given to the overall status of logistics in Turkey. We construct a mixed integer programming model for the multi-period, multi-item, multi-level capacitated facility location/relocation problem of Efes. The model determines the locations of new malt plants and breweries as well as the distribution decisions for barley, malt, and different types of beer while minimizing fixed costs and annual transportation costs. We suggest a procedure to set effective capacities of breweries due to seasonality of demand. We solve the model under different parameter settings in order to obtain a variety of solutions that the decision makers may find useful. We discuss our results and experiences from this application process.

In 2008, world trade amounted to over $15.8 trillion, and developing countries were the origin of 38 % of worldwide exports. In every case, a sourcing (buying) decision had to be made, and as we shall show, global logistics is both a logical and essential component in these decisions. This chapter first reviews the motivation for global sourcing/procurement and the role of logistics in executing this strategy. Then we indicate how procurement managers and their logistics service providers can obtain the necessary information to evaluate logistics capabilities throughout the world. Finally, we illustrate the importance of global logistics to sourcing/procurement through an Appendix, a case study that spans the U.S./Mexico border.

For millions of people across Africa, health interventions such as vaccines, HIV counseling and treatment, and other public health expertise are out of reach. Barriers to health care can include shortage of health personnel, scarcity of medicines, distance to a health center, terrain, poverty and lack of transportation. The logistical challenges to the delivery of health care in underdeveloped economies are often insurmountable. This case study examines a comprehensive vehicle management model designed by the social enterprise Riders for Health (Riders) to provide African ministries of health with consistently reliable and cost-effective vehicle fleets, thus enabling large-scale health care delivery. The model has been implemented through a public–private partnership between Riders and the Gambian Ministry of Health. When the national vehicle fleet is fully rolled out, Gambia will become the first African country to have sufficient health care delivery vehicles to service its population. The case highlights innovative best practices that can improve the coordination of material, information and financial flows of health logistics in extreme conditions. These innovations require diverse stakeholders such as NGOs, government, and donor organizations to work in close collaboration; incentive alignment is a critical step towards developing these partnerships. What Riders has been able to achieve in Gambia and other parts of Africa can serve as a lesson for business logistics operations in emerging economies.

This chapter examines the Asian, European, North American and Middle East air freight networks of combination passenger and freight and all-freight carriers using air freight capacity datasets for the period 1999–2009. The chapter begins by reviewing some of the key trends that have shaped and characterized air freight markets during the 1990 and 2000s. The impact of air transport market liberalization is identified as a key determinant of changing carrier behavior, particularly in relation to network structure organization. The second major section of the chapter examines the sources of data available for tracking trends in the air freight sector. The lack of comprehensive datasets detailing the activities of the integrated carriers is discussed. Using the Official Airline Guide (OAG) historical databases that list ex-post carrier schedules for each year globally, annual data series indicating freight capacity of all Asian, European and North American and selected Middle Eastern carriers are determined and the general trends are described. The US T-100 Database is used to derive an equivalent distribution for the two largest integrated carriers, FedEx and UPS. The changing nature of industry organization is discussed and the key players in each region are distinguished. For the combination carriers, passenger and freight network structures are compared for the period 1999–2009. The fortunes of the key air freight hubs are reviewed over the same period. The chapter concludes with a discussion about the key driving factors in dictating the future direction of the industry in the coming decade. Consolidation in the airline industry and the role of the integrated carriers receive particular consideration.

Activities at an international border are meant to ensure the security of the residents of a country. The inevitable results are “cross-border issues”—challenges, decisions, and responsibilities not encountered when movements of freight or people are entirely within one nation. This chapter discusses the most common cross-border events that carriers, shippers, importers, and exporters encounter when products move across an international frontier, with an emphasis on academic research on border issues and operations.

This chapter, which explores the interplay between three significant factors in global supply chains, holds two research objectives. The first is a model to maximize after tax profit by prescribing facility locations, transportation modes, and material flows in a global supply chain. The second is to demonstrate relationships among these three components through a case study.

Unfortunately, the world has experienced frequent disasters as well as mega-disasters in the last decade. The challenges faced during the relief efforts to those disasters called for improvements in the area of humanitarian logistics. In this chapter, first we present introductory knowledge on disaster management and humanitarian logistics. The complexities and inefficiencies in the current relief response practice are indicated. To improve the disaster response, we investigate the options of advance purchasing and pre-positioning of the relief items through applied projects performed for different humanitarian organizations.

Logistics intensive clusters are agglomerations of several types of firms and operations: (1) firms providing logistics services, such as 3PLs, transportation, warehousing and forwarders, (2) the logistics operations of industrial firms, such as the distribution operations of retailers, manufacturers (in many cases after-market parts) and distributors and (3) the operations of companies for whom logistics is a large part of their business. Such logistics clusters also include firms that service logistics companies, such as truck maintenance operations, software providers, specialized law firms, international financial services providers, etc. Logistics clusters exhibit many of the same advantages that general industrial clusters (such as Silicon Valley, Hollywood, or Wall Street) do: increase in productivity due to shared resources and availability of suppliers; improved human networks, including knowledge sharing; tacit communications and understanding; high trust level among companies in the cluster; availability of specialized labor pool as well as educational and training facilities; and knowledge creation centers, such as universities, consulting firms, and think tanks. Logistics clusters, however, exhibit other characteristics which make them unique in terms of cluster formation and their contribution to economic growth. Logistics operations may locate in a logistics cluster due to the cluster’s role in supporting economies of scope (mainly for direct operations transport modes) and economies of density (mainly for consolidated transportation modes); their provision of spill-over capacity for warehousing and transportation; and the ability to cooperate between providers when dealing with demand fluctuations. Such clusters provide a range of employment opportunities—from moving boxes to executive, IT and other professional jobs, and they diversify the economic base since they support many other industries, such as manufacturing as well as a range of “mini-clusters.” This chapter describes such clusters, based on primary research in several large logistics clusters around the world, interviews with dozens of executives in retail, manufacturing and distribution organizations; with transportation and logistics service providers; with infrastructure operators; with public and private development agencies; and with real estate developers.

This chapter discusses Proactive Order Consolidation (POC), a recently-proposed strategy for wholesalers acquiring goods according to global supply policies. The strategy aims to group orders before they are communicated to suppliers in such a way that the total cost of transportation and inventory of the firm is minimized. We briefly review processes and practices relative to procurement and order management, as well as consolidation activities in logistics. We then detail the POC concept and issues focusing on the associated information and decision systems and processes. Experimental results on data from an actual case study illustrate the interest of the POC strategy.

We speculate on the prospects for Global Logistics over the next 10–15 years. Three international transformations are emphasized: (1) Global trade will be enhanced, but often shifted to new regions (Asia, Africa). (2) Climate change will negatively affect ports and landside infrastructure, while possibly allowing faster transportation between Europe and Asia (through an Arctic Ocean that may become ice free). (3) Continued digital processing power, wireless communication and the internet will allow tracking of all logistical and transportation movements. Non-visible inventory will be the exception. Intelligent transportation technology, including next-generation air traffic control, will increase the efficient utilization of transport infrastructure. We offer considered opinions, backed by examples and references where we can, on the three main changes and others. Particular assumptions that we have made are highlighted throughout.