WWW.THESIS.DISLIB.INFO
FREE ELECTRONIC LIBRARY - Online materials, documents
 
<< HOME
CONTACTS



Pages:   || 2 | 3 | 4 |

«The terminalization of supply chains: reassessing the role of terminals in port/hinterland logistical relationships Jean-Paul RODRIGUE Department of ...»

-- [ Page 1 ] --

The terminalization of supply chains: reassessing the

role of terminals in port/hinterland logistical

relationships

Jean-Paul RODRIGUE

Department of Global Studies & Geography

Hofstra University, Hempstead, New York 11549, USA

Jean-paul.Rodrigue@Hofstra.edu

Theo NOTTEBOOM

Institute of Transport and Maritime Management Antwerp (ITMMA) – University of Antwerp

Keizerstraat 64, 2000 Antwerp

theo.notteboom@ua.ac.be

Abstract

The paper discusses how logistics service providers are using terminals in their supply chains. It argues that an increasing „terminalization‟ of supply chains is unfolding, whereby seaport and inland terminals are taking up a more active role in supply chains by increasingly confronting market players with operational considerations such as imposing berthing windows, dwell time charges, truck slots, all this to increase throughput, optimize terminal capacity and make the best use of available land. With the development of inland terminals, a new dimension is being added: logistics players are now making best use of the free time available in seaports terminals and inland terminals, thereby optimizing the terminal buffer function. As a result, transport terminals are achieving an additional level of integration within supply chains that goes beyond their conventional transshipment role.

Given increasing levels of vertical integration in the market and an increasing pressure on port capacity, a further terminalization of supply chains is likely to occur, which will strengthen the active role of terminals in logistics.

Keywords: freight distribution, port terminal, inland terminal, terminalization, supply chains

1. Introduction Transport terminals are the main regulators of freight flows and as such considerably influence the setting and operation of supply chains in terms of location, capacity and reliability. Their function as gateways and hubs of global freight distribution is well known. Containerization has changed the function and layout of terminals. The introduction of container vessels meant larger cargo volumes per port call and shorter handling times per volume of freight. Both factors contributed to a modal separation at terminals and the setting of a significant buffer in the form of large stacking areas (figure 1). This modal separation in space was a requirement for setting up a system of indirect transshipment whereby each transport mode follows its own time schedule and operational throughput, implying a modal separation in time. Under the indirect transshipment system, the terminal stacking area functions as a buffer and temporary storage area between the deepsea operations and the land transport operations thattake place later in the process (or earlier depending on the stage along the supply chain). As a consequence, and in spite of higher turnover levels, the space consumed by container terminals increased substantially. In turn, these space requirements changed the geography of ports and the migration of terminals to new peripheral sites, as outlined in port development models such as those of Bird (1980) and Hoyle (1988). These issues are well documented.

Figure 1 Modal and Temporal Separation at Freight Transport Terminals

However, advances in logistics in the last decades gave a new meaning to the temporary storage at terminals. Instead of using the stacking area as a facilitator for a smooth synchronization between transport modes, shippers and logistics service providers started to use terminals as places for the cheap storage of consignments. This change in the functional use of terminals implied that high dwell times at container yards were no longer an indication of a poor connectivity, low productivity and lack of synchronization between maritime operations and land transport. It represents a divergence from conventional port productivity measures (Kek Choo Chung, 1993). High dwell times got increasingly associated with deliberate actions of actors in the supply chain. Additionally, in many cases the purchaser can delay payment to the vendor until final delivery even if the consignment is conveniently available at the nearby terminal. Terminals thus became buffers in supply chains, sometimes absorbing inefficiencies created elsewhere in the chain.

This paper discusses how logistics service providers are using terminals in their supply chains. It argues that an increasing „terminalization‟ of supply chains is unfolding, whereby seaport and inland terminals are taking up a more active role in supply chains by increasingly confronting market players with operational considerations such as imposing berthing windows, dwell time charges, truck slots, all this to increase throughput, optimize terminal capacity and make the best use of available land. As a result, transport terminals are achieving an additional level of integration within supply chains that goes beyond their conventional transshipment role. Given increasing levels of vertical integration in production and distribution and an increasing pressure on port capacity, a further terminalization of supply chains is likely to occur, which will strengthen the active role of terminals in logistics.

First, this paper discusses the terminalization concept and links it to existing literature on the role of terminals. Then, it investigates the concrete unfolding of terminalization processes in supply chains. The role of deepsea terminals in shaping terminalization processes and examples of terminalization processes in Europe and North America are then presented.





2. Terminalization and the function of terminals in supply chains

A port terminal is commonly defined as a specialized facility where ocean vessels dock to discharge and load cargo. Container terminals are facilities designed to handle containers, with specialized equipment such as container cranes, straddle carriers or stacking cranes and container stacking areas. However, the above technical definition of a terminal does not portray the specific function of terminals in supply chains. Heaver (1993) argues that terminals have come to be specially designed to meet the cargo handling and throughput requirements of integrated logistic systems. Of particular relevance is Heaver‟s assertion that terminals rather than ports are adversaries in the competitive struggle between ports.

While terminals undeniably compete with one another, they do not compete exclusively for tangible assets such as port infrastructure. Operators are primarily competing through the provision of services that add value within the supply chains of its users. This perspective thus begs to reassess the role of terminals. Robinson (2006:54) and Robinson (2002) rightly underline that terminals are in essence through locations or elements in logistics pathways from sellers to buyers. It implies that terminals deliver value to its users (shipping lines, logistics service providers and shippers) not as individual locations but as elements in larger systems of circulation. The value creation process of a terminal is thus linked to the specific attributes of the supply chains that run through the terminal and the logistics network configuration in which the terminal plays a role.

In this paper, we introduce the concept of „terminalization‟ of supply chains to capture the changing role of terminals as through locations in supply chains. It is worth considering to what extent terminalization is an unintended consequence of a new and more constrained context in freight distribution or simply a transitory phase in port / hinterland evolution.

Initially, the term terminalization was brought forward to illustrate a new functional and operational reality of seaports where terminal operators were playing a more important role (Olivier and Slack, 2006; Slack 2007). For instance, the different strategies of global port operators, notably in terms of capital investment, have led in several cases in notable differences in terminal productivity within the same port. Here, the concept is expanded over the realm of supply chains, where two types of terminalization can be identified (Figure 2): bottleneck-derived terminalization and warehousing-derived (buffer) terminalization.

Bottleneck-derived terminalization encompasses a conventional perspective on the role of terminals where the terminal is the main source of delay and capacity constraint for the supply chain. It does not necessarily mean that the terminal is running close to capacity, but that operational issues (storage space, port call frequency, gate access) are imposing a more rational use of the facilities so that the performance and reliability of the terminal is maintained. This is particularly important since terminal operators must maintain a level of service to their users, particularly maritime shipping lines. In this case the supply chain adapts with volume, frequency and scheduling changes and may seek alternatives if possible.

Warehousing-derived (buffer) terminalization refers to an emerging trend where the function of warehousing, in whole or in part, is shifted to the terminal. The terminal becomes the main buffer instead of the distribution center, which functionally makes the terminal a component of the supply chain, no longer as a factor of delay, but as a storage unit. Even if this trend appears paradoxical vis-à-vis “just-in-time” strategies, it gives the supply chain a higher level of flexibility to lower their warehousing costs as well as to adapt to unforeseen events such as demand spikes or delays. An “inventory in transit” strategy coupled with an “inventory at terminal” one can reduce significantly warehousing requirements at distribution centers. Considering the wide variety of commodity chains, each with its own requirements in terms of origins, destinations, frequency, reliability and overall elasticity, buffer-derived terminalization can take many forms.

Historically, distribution centers were located adjacent to terminals, leading to the creation of port-industrial or rail-industrial complexes than not only encompassed heavy industrial activities but a wide range of manufacturing. The terminalization of supply chains was thus important as terminals were the core component in delays since inland freight distribution tended to be costly and unreliable for break-bulks. Containerization has broken this relevance, initially with improved intermodal efficiencies and later on with the setting of inland transport systems. Paradoxically, the terminal became less relevant as the productivity gains of containerization were absorbed by supply chains, which became structurally and spatially more flexible. This came to be known as the move from “push” (manufacture to supply) to “pull” (manufacture to order) logistics. While a push logistics system involves a limited level of integration between suppliers, manufacturers and distributors, a pull logistics system tries to achieve a higher level of efficiency through integration and synchronization. Freight flows between components of the supply chain tended to be more frequent, in smaller batches and subject to tight time constraints. In addition, the sharing of demand dependant data (such as sales) helped better synchronize supply with demand. The emergence of large terminals in new manufacturing clusters, such as the Pearl River Delta, is indicative of the changes brought by the setting of global supply chains supporting global production networks.

However, due to supply chain issues, namely capacity, congestion and security, it is argued that terminalization is resurging in a new form. The move from “push” to “pull” logistics may unfold as “hold” logistics where supply chain management places a greater emphasis to the time constraints related to terminal use. The conventional inventory in transit approach widely used for containerized modes is being complemented by buffer / hold logistics at terminals due to congestion, but also since the terminal is the convergence point – the gateway – of global freight distribution. However, it is becoming difficult for many large terminals, particularly gateway ports, to provide additional capacity because of space and environmental constraints. The capacity of inland distribution has also been a limiting factor, but the setting of inland terminals linked to gateways by high capacity corridors has provided a new dynamic as we will illustrate in the next section.

3. Unraveling terminalization processes in supply chains Terminalization is a particularly suitable strategy for international long distance supply chains, which have become notably prevalent in the consumption goods sector, including a wide variety of products, from apparel to electronics. Figure 2 provides a schematic overview of a typical retailing supply chain where production and consumption have a substantial geographical differentiation. In the next sections we will consecutively look at how terminalization is unfolding in each of the segments of the supply chain.

Figure 2 Forces towards terminalization in a global retailing supply chain

3.1. Export flows to the gateway The export oriented gateway in the midst of a manufacturing cluster is commonly facing capacity issues, implying some constraints in the usage of its facilities. Containerized cargo flows reach the gateway either directly from the supplier or via an intermediate export center in the port area, in a logistics zone near the gateway or in a hinterland location connected to the gateway via a multimodal transport corridor. Mainly in Pacific Asia, export centers are often used as consolidation points and container stuffing locations for non-containerized cargo. Inland connections tend to be poor and trade flows imbalanced, so distribution centers agglomerate nearby gateway facilities, which favors a fast turnover of containers. Once produced and assembled in container loads, the goal is to insure that they are shipped to the maritime segment promptly. Distribution tends to be synchronized with terminal handling capacity and availability implying that terminalization is mainly bottleneck-related at this stage.



Pages:   || 2 | 3 | 4 |


Similar works:

«ISDA Jounal 19 (1) 2009, pp.37-48 Copy right @ by Institute for the Study of Developing Areas ISSN 0971-2550 CITIZENS PARTICIPATION IN LOCAL GOVERNANCE-A STUDY OF WARDS COMMITTEE IN BANGALORE MUNICIPAL CORPORATION Midatala Rani* and Ashwini Roy A.S ** ABSTRACT th The 74 Constitution Amendment Act provides for a significant devolution of functions and powers to the local bodies through decentralization and people’s participation in local self-governance. The main thrust of decentralization is...»

«COMMUNICATIONS & MARKETING VIRGINIA MUSEUM OF FINE ARTS 200 N. Boulevard I Richmond, Virginia 23220-4007 www.vmfa.museum/pressroom I T 804.204.2704 Art Acquisitions February 2012 1. Karl L. H. Müller (American, born Germany, ca. 1820-1887), designer. Union Porcelain Works (active 1863-ca. 1922), manufacturer. Century Vase, ca. 1876-77, Greenpoint (now Brooklyn), New York. Porcelain, with bisque and glazed surfaces, partially painted and gilded, 12 ¾ inches high. Marked: ―K. MULLER‖ under...»

«Case 1:09-cv-00023 Document 469 Filed 08/07/13 Page 1 of 8 UNITED STATES DISTRICT COURT FOR THE NORTHERN MARIANA ISLANDS BETTY JOHNSON on behalf of herself, ) CIVIL CASE NO. 09-00023 and as a representative of a class of ) similarly-situated persons, ) ORDER PRELIMINARILY APPROVING ) CLASS ACTION SETTLEMENT ) Plaintiff, ) ) vs. ) ) ELOY S. INOS, Governor of the ) Commonwealth of the Northern Mariana ) Islands (“CNMI”); ADELINA C. ) ROBERTO, Fund Trustee and Vice ) Chairwoman; NACRINA...»

«Preaching to the Spirits in Prison 1 Peter 3:17 4:6 Vernon G. Wilkins Salvation from Destruction Fire and Ice Some say the world will end in fire, Some say in ice. From what I’ve tasted of desire I hold with those who favor fire. But if it had to perish twice, I think I know enough of hate To say that for destruction ice Is also great And would suffice. Robert Frost, 1920 It seems Frost realised the destructive effect of the world’s sin. Noah discovered this in his time and in his world...»

«Comptroller General of the United States United States Government Accountability Office Washington, DC 20548 DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This redacted version has Decision been approved for public release. Matter of: Science Applications International Corporation File: B-413501; B-413501.2 Date: November 9, 2016 William L. Walsh, Jr., Esq., J. Scott Hommer, III, Esq., Miranda S. Riemer, Esq., Keir X. Bancroft, Esq.,...»

«Little Brokenstraw Creek Watershed (0501000110) Brokenstraw Creek Watershed (0501000111) Water Index Number Waterbody Segment Category Pa-71 Little Brokenstraw Creek and minor tribs (0202-0057) Threatened Pa-713 East Br. Little Brokenstraw and tribs (0202-0058) Unassessed Pa-74 thru 75 Goshen Creek, Upper, and tribs (0202-0059) Unassessed Pa-77 Brokenstraw Creek and minor tribs (0202-0005) Minor Impacts Pa-771 Gallup/Town Stream and tribs (0202-0060) Minor Impacts Pa-771-P150 Hurburt/Clymer...»

«Unsupervised Profiling Methods for Fraud Detection Richard J. Bolton and David J. Hand Department of Mathematics Imperial College London {r.bolton, d.j.hand}@ic.ac.uk Abstract Credit card fraud falls broadly into two categories: behavioural fraud and application fraud. Application fraud occurs when individuals obtain new credit cards from issuing companies using false personal information and then spend as much as possible in a short space of time. However, most credit card fraud is behavioural...»

«FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT  DAVID LAHOTI, an individual, Plaintiff-Appellant, No. 08-35001  v. D.C. No. CV-06-01132-JLR VERICHECK, INC, a Georgia Corporation, OPINION  Defendant-Appellee. Appeal from the United States District Court for the Western District of Washington James L. Robart, District Judge, Presiding Argued and Submitted March 9, 2009—Seattle, Washington Filed November 16, 2009 Before: William A. Fletcher, Ronald M. Gould, and...»

«2009 2014 EUROPÄISCHES PARLAMENT Ausschuss für Binnenmarkt und Verbraucherschutz IMCO_PV(2011)1121_1 PROTOKOLL der Sitzung vom 21. November 2011, 15.00 – 18.30 Uhr, 22. November 2011, 9.00 – 12.30 Uhr und 15.00 – 18.30 Uhr, und 23. November 2011, 9.00 – 12.30 Uhr und 15.00 – 18.30 Uhr BRÜSSEL Die Sitzung wird am Montag, 21. November 2011, um 15.06 Uhr unter dem Vorsitz von Malcolm Harbour eröffnet.21. November 2011, 15.00 – 15.45 Uhr In Anwesenheit des Rates und der Kommission...»

«Absolving Beta of Volatility’s Effects by* Jianan Liu, Robert F. Stambaugh, and Yu Yuan First Draft: April 17, 2016 Abstract The beta anomaly—negative (positive) alpha on stocks with high (low) beta—arises from beta’s positive correlation with idiosyncratic volatility (IVOL). The relation between IVOL and alpha is positive among underpriced stocks but negative and stronger among overpriced stocks (Stambaugh, Yu, and Yuan, 2015). That stronger negative relation combines with the...»

«The Subaru BPMR (Buff Long Course) is a one-day 5-stage multisport competition consisting of a 16 km paddle, 32-37 km cycle, 16 km run, 30 km cycle, and 6 km run. The Subaru BPMR (Suntrail Course) is a one-day multisport competition in a loop consisting of a 4 km paddle, 250m run, 15 km mountain bike, and 6 km run. The Subaru Duathlon is 4K of paddling & 300m of running, 15km bike, 300m run and a 4km paddle, followed by a 50m sprint to the finish. The Run Duathlon is a 6k run, 15k bike, 6k run....»

«Career Center Mission The Career Center offers individualized assistance, programs, and technologically advanced resources to educate students in the development of lifelong career management skills, the attainment of work experience, and the integration of academic and career plans. Services Staff Drop-In/Consulting Hours Ask quick questions about your job search, resume or cover letter, or graduate and professional school Tom Matthews, Director applications. See website for times....»





 
<<  HOME   |    CONTACTS
2017 www.thesis.dislib.info - Online materials, documents

Materials of this site are available for review, all rights belong to their respective owners.
If you do not agree with the fact that your material is placed on this site, please, email us, we will within 1-2 business days delete him.