Frans Cruijssen

Horizontal cooperation in transport and logistics: A literature review

This article presents a broad review of horizontal cooperation in transport and logistics. This topic is fast gaining momentum in the logistics sector and is thus highly relevant from a practical point of view. Moreover, horizontal cooperation is also interesting from a theoretical perspective because it can be approached by various disciplines, offering a forum for economists, operations researchers, and psychologists, among others. The purpose of this article is to provide a starting point for intensified future research on the topic of horizontal cooperation. In addition to a discussion of various types of horizontal cooperation and closely related literature, the drivers, impediments, and facilitators are reviewed and supported by an extensive bibliography.

Joint Route Planning under Varying Market Conditions

Purpose - To provide empirical evidence on the level of savings that can be attained by joint route planning and how these savings depend on specific market characteristics.Design/methodology/approach - Joint route planning is a measure that companies can take to decrease the costs of their distribution activities. Essentially, this can either be achieved through horizontal cooperation or through outsourcing distribution to a Logistics Service Provider. The synergy value is defined as the difference between distribution costs in the original situation where all entities perform their orders individually, and the costs of a system where all orders are collected and route schemes are set up simultaneously to exploit economies of scale. This paper provides estimates of synergy values, both in a constructed benchmark case and in a number of real-world cases. Findings - It turns out that synergy values of 30% are achievable. Furthermore, intuition is developed on how the synergy values depend on characteristics of the distribution problem under consideration. Practical implications - the developed intuition on the nature of synergy values can help practitioners to find suitable combinations of distribution systems, since synergy values can quickly be assessed based on the characteristics of the distribution problem, without solving large and difficult Vehicle Routing Problems. Originality/value - this paper addresses a major impediment to horizontal cooperation: estimating operational savings upfront.

Factory Gate Pricing : an analysis of the Dutch retail distribution

Factory gate pricing (FGP) is a relatively new phenomenon in retail distribution. Under FGP, products are no longer delivered at the retailer distribution center, but collected by the retailer at the factory gates of the suppliers. Owing to both the asymmetry in the distribution networks (the supplier sites greatly outnumber the retailer distribution centers) and the better inventory and transport coordination mechanisms, this is likely to result in high cost savings. A mathematical model was used to analyze the benefits of FGP. The main contribution of this paper is its practical approach to transport consolidation in this recently emerging supply chain concept in retail distribution. Extensive numerical results for a large real-life case study of the Dutch retail distribution are presented to show the effect of the orchestration shift from supplier to retailer, the improved coordination mechanisms, and sector-wide cooperation.

Empirical Study : Order Sharing Between Transportation Companies may Result in Cost Reductions Between 5 to 15 Percent

In the traditional situation, all transportation companies had their own clients and their own set of transportation orders.In a situation with order sharing, transportation companies mutually share their data on transportation orders.This enables a much better allocation of orders to the transportation companies than in the traditional situation.In this paper we discuss the economic and other consequences of order sharing.The conclusions in this paper are based on both a real-life case and a simulation study.The simulation study shows that due to order sharing transportation costs may decrease by 5 to 15 percent, and sometimes even more.

Logistic Efficiency Through Horizontal Cooperation : The Case of Flemish Road Transportation Companies

This paper describes a practical application of Data Envelopment Analysis (DEA) to the Flemish road transportation sector.The efficiency of 82 road transportation companies responding to a large-scale survey focused on horizontal cooperation is evaluated, based on two inputs and two outputs.Various DEA models are used to identify differences between subgroups of respondents.The results demonstrate that, in general, Flemish road transportation companies operate at unacceptably low efficiency levels.Given the findings that the median company is operating on too small a scale one apparent remedy would be a dramatic increase in market concentration through mergers and acquisitions

Joint Hub Network Development

This paper introduces a framework for joint hub network development. Building a joint physical hub for transhipment of goods is expensive and therefore involves considerable risks for the cooperating companies. In a practical setting, it is unlikely that an entire network will be built at once. Rather, the partners will have a more cautious attitude and build the hub facilities one-by-one. In the proposed framework, every time a new hub is introduced, partners will have the opportunity to decide whether or not they participate (and thus invest) in this network extension. The framework is also applicable in cooperative situations other than hub network development. In cases where multiple (infrastructural) investments have to be made by a consortium of logistics companies, the participants are likely to take advantage of a step-wise approach with gain sharing at intermediate steps. More specifically, the procedure can also benefit maintenance groups, warehouse sharing initiatives, and intermodal groups.