Table Of Content

Logistics Transportation Systems Logistics Transportation Systems MD Sarder BowlingGreen StateUniversity, BowlingGreen,OH, USA Elsevier Radarweg29,POBox211,1000AEAmsterdam,Netherlands TheBoulevard,LangfordLane,Kidlington,OxfordOX51GB,UnitedKingdom 50HampshireStreet,5thFloor,Cambridge,MA02139,UnitedStates Copyright©2021ElsevierInc.Allrightsreserved. Nopartofthispublicationmaybereproducedortransmittedinanyformorbyanymeans, electronicormechanical,includingphotocopying,recording,oranyinformationstorageand retrievalsystem,withoutpermissioninwritingfromthepublisher.Detailsonhowtoseek permission,furtherinformationaboutthePublisher’spermissionspoliciesandour arrangementswithorganizationssuchastheCopyrightClearanceCenterandtheCopyright LicensingAgency,canbefoundatourwebsite:www.elsevier.com/permissions. Thisbookandtheindividualcontributionscontainedinitareprotectedundercopyrightbythe Publisher(otherthanasmaybenotedherein). 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BritishLibraryCataloguing-in-PublicationData AcataloguerecordforthisbookisavailablefromtheBritishLibrary LibraryofCongressCataloging-in-PublicationData AcatalogrecordforthisbookisavailablefromtheLibraryofCongress ISBN:978-0-12-815974-3 ForInformationonallElsevierpublications visitourwebsiteathttps://www.elsevier.com/books-and-journals Publisher:JoeHayton AcquisitionsEditor:BrianRomer EditorialProjectManager:ChiaraGiglio ProductionProjectManager:MariaBernard CoverDesigner:VictoriaPearson TypesetbyMPSLimited,Chennai,India Contents Preface xv Acknowledgments xix 1. Overview of transportation logistics 1 1.1 Introduction:whatistransportationlogistics? 1 1.2 Theimportanceoftransportationsystems 3 1.3 Thehistoryoftransportationsystems 7 1.4 Transportationmanagement 10 1.4.1 Logisticsplanning 10 1.4.2 Logisticsfunctions 11 1.4.3 Logisticsgoalsandstrategies 11 1.4.4 Transportationprocesses 12 1.5 Logisticscosts 13 1.6 Logistics/transportationcostimplications 16 1.7 Transportationmodes 18 1.7.1 Truck 19 1.7.2 Rail 20 1.7.3 Water 23 1.7.4 Pipeline 27 1.7.5 Air 28 1.8 Practicalimplications 31 1.9 Conclusion 34 1.10 Discussionquestions 34 References 35 2. Network and cost analysis of transportation system 37 2.1 Introduction 37 2.2 Terminology 38 2.3 Transportationnetwork 39 2.4 Classificationoftransportationnetwork 40 2.5 Operationalnetworkstructure 40 2.5.1 Directshippingwithmilkruns 40 2.5.2 AllshipmentsviacentralDC 42 2.5.3 ShippingviaDCusingmilkruns 42 2.6 Hubadvantages 44 2.7 Hubdisadvantages 44 2.8 Performancecriteria 44 v vi Contents 2.9 Algorithms 46 2.10 Mathematicaltools 47 2.11 Layersofnetwork 48 2.11.1 Physicalnetwork 48 2.11.2 Operationalnetwork 48 2.11.3 Strategicnetwork 49 2.12 Transportationcost 49 2.12.1 Transportationcostcomponents 50 2.12.2 Transportationcostcategories 52 2.12.3 Transportationcostfunction 52 2.12.4 Factorsthatinfluencetransportationcost 56 2.13 Networkproblems 57 2.14 Conclusion 57 References 57 Furtherreading 58 3. Transportation infrastructure and equipment 59 3.1 Transportationinfrastructure 59 3.2 Transportationequipment 59 3.3 Truck/roadinfratructures 61 3.4 Railinfrastructures 69 3.5 Maritimeinfrastructures 72 3.5.1 Generalcargoships(sometimescalledbreakbulk carriers) 73 3.5.2 Bulkcarriers 74 3.5.3 Containerships 75 3.5.4 Autocarriers 75 3.5.5 Tankers 75 3.5.6 Fishingvessels 75 3.5.7 Oilindustryvessels 76 3.5.8 Passengerships 76 3.5.9 Ferryboats 76 3.5.10 Towandtugboats 76 3.5.11 Barges 77 3.6 Aviationinfrastructures 78 3.7 Containerization 80 3.7.1 Advantagesofcontaineruse 83 3.7.2 Disadvantagesofcontaineruse 85 3.8 Significanceoftransportationinfrastructureoneconomy 85 3.9 UStransportationinfrastructureplan 86 3.10 Conclusion 88 3.11 Discussionquestions 88 References 88 4. Transportation rules and regulations 89 4.1 Introduction 89 Contents vii 4.2 Creatingtransportationlaws 89 4.3 Federaltransportationlaws 90 4.4 Railroadindustryregulations 91 4.5 Motorcarrierregulation 92 4.6 Regulationsintheairlineindustry 94 4.7 Internationalwaterregulations 94 4.7.1 Freedomoftheseas 94 4.7.2 UnitedNationsLawoftheSeaConvention 95 4.7.3 Protectionofmarineenvironmentandbiodiversity 95 4.7.4 Marineshippingandpollution 96 4.7.5 Polarcode 96 4.7.6 Piracy 96 4.8 Importingprocedures 96 4.8.1 Customsandimporters 96 4.8.2 Entryofgoods 97 4.8.3 Customsexaminationofentrygoods/documents 97 4.8.4 Penalties 98 4.9 Tradeagreements 98 4.10 Hazardousmaterialsregulations 100 4.11 Foreigntradezones 101 4.12 Freightforwarding 102 4.12.1 Freightforwardingand3PLlogisticproviders 103 4.12.2 Freightforwardingand4PLlogisticproviders 104 4.12.3 3PLlogisticprovidersversus4PLlogisticproviders 104 4.12.4 Fourth-partylogisticsisthebestchoice 105 4.13 Incoterms 106 4.14 Conclusion 106 References 107 Furtherreading 107 5. Intermodal transportation 109 5.1 Introduction 109 5.2 Modality 109 5.2.1 Unimodalism 109 5.2.2 Multimodalism 110 5.3 Intermodalfreighttransportation 110 5.3.1 Intermodalism 112 5.3.2 Whatisthedifference? 112 5.4 Componentsofintermodaltransportation 113 5.4.1 Containers 113 5.4.2 Carriers 114 5.4.3 Shippers 115 5.5 Domestictransportation 115 5.5.1 Domesticcommodities 116 5.5.2 Domesticintermodal 116 5.5.3 IntermodalfreightdistributionintheUnitedStates 118 viii Contents 5.5.4 TrendsofcontainerfreightshipmentsintheUnitedStates 119 5.5.5 ImportedcontainerdistributionsintheUnitedStates 120 5.6 Internationaltransportation 126 5.6.1 Internationalcommoditiesandtrade 126 5.7 Selectioncriteriaofmodeoftransportation 127 5.7.1 Costoftransportation 129 5.7.2 Dependabilityandconsistencyofservice 129 5.7.3 Security 129 5.8 Lastmiledelivery 133 5.8.1 Whatislast-miledelivery? 133 5.8.2 Uniquechallengesoflastmiledelivery 134 5.9 Challengesofintermodaltransportation 135 References 135 Furtherreading 136 6. Logistics transportation problems with linear programming 137 6.1 Overview 137 6.2 Introduction 137 6.3 Literaturereview 137 6.3.1 Linearprogramming 137 6.3.2 Transportationproblems 138 6.4 Solvingtransportationproblems 141 6.4.1 LPFormulation 141 6.4.2 Stepsinsolvingatransportationproblems 143 6.5 Graphicalmethod 150 6.6 Simplexmethodandthetransportationtableau 153 6.7 Solvermethod 157 6.8 Sensitivityanalysis 164 6.9 Conclusion 166 References 167 7. Assignment and transshipment problems with linear programming 169 7.1 Overview 169 7.2 Introduction 169 7.3 Literaturereview 169 7.4 Assignmentproblems 170 7.4.1 Methodsofsolvingtheassignmentproblem 170 7.4.2 Mathematicalformulaofsolvingassignmentprogram usinglinearprogramming 171 7.4.3 Simplex(solver)method 172 7.4.4 TheHungarianalgorithm 176 7.5 Transshipmentproblems 180 7.5.1 LPformulationfortransshipmentproblem 181 Contents ix 7.6 Sensitivity 194 7.7 Conclusion 194 References 194 Furtherreading 195 8. Logistics customer services 197 8.1 Introduction 197 8.2 Definitionofcustomerservice 198 8.2.1 Elementsofcustomerservice 200 8.2.2 Relativeimportanceofcustomerserviceelements 202 8.3 Ordercycletime 202 8.3.1 Ordercycletimeadjustments 204 8.3.2 Prioritiesfororderprocessing 204 8.3.3 Standardsforordercondition 205 8.3.4 Orderconstraints 205 8.4 Importanceoflogisticscustomerservice 205 8.4.1 Serviceeffectsonsales 206 8.4.2 Serviceeffectsoncustomerretention 207 8.5 Sales(cid:1)servicerelationship 207 8.6 Sales(cid:1)servicerelationshipmodel 208 8.6.1 Two-pointmethod 208 8.6.2 Before/afterexperiments 209 8.6.3 Gameplaying 209 8.6.4 Buyersurveys 209 8.7 Costsversusservice 209 8.8 Determiningoptimumservicelevels 210 8.8.1 Whyisitimportanttoidentifyoptimumservicelevel? 210 8.8.2 Practicalimplications 211 8.9 Customerservicevariability 211 8.9.1 Taguchi’slossfunction 212 8.9.2 Supplychainvisibility 213 8.10 Serviceasaconstraint 214 8.11 Measuringlogisticsservicequality 214 8.11.1 Servicecontingencies 215 8.11.2 Systembreakdown 216 8.11.3 Productrecallandreturn 216 8.12 Conclusion 217 References 217 Furtherreading 217 9. Transportation rates and decision analysis 219 9.1 Introduction 219 9.2 Ratesfordifferentmodesoftransportation 220 9.3 Importanceofchoosingthemostcost-effective transportationsystem 222 9.4 Servicechoices 224 x Contents 9.4.1 Characteristics 224 9.4.2 Single-servicechoices 224 9.4.3 Intermodalservices 225 9.5 Factorsaffectingtransportationratesandcosts 225 9.5.1 Productvolume 227 9.5.2 Demand-relatedrates 227 9.5.3 Distanceoftravel(line-Haulrates) 227 9.5.4 Otherfactorsaffectingtransportationratesandcosts 228 9.5.5 Specialservicecharges 230 9.6 Documentation 231 9.6.1 Billoflading 231 9.6.2 Freightbill 232 9.6.3 Freightclaims 232 9.6.4 Internationaltransportdocumentation 232 9.7 Approachestonegotiatingtransportationrates 233 9.7.1 Negotiationwithindividualcarriers 233 9.7.2 Usingabidprocess 233 9.8 Collectandanalyzedata:preparinganrequestforproposal 234 9.9 Buildingstrongserviceproviderrelationships 234 9.10 Postnegotiationsupport 237 9.11 Commonmisconceptionsinratenegotiation 238 9.11.1 Youwillalwaysgetthebestrateswhengoing directlytothecarriers 239 9.11.2 Fuelsurchargescannotbenegotiated 240 9.11.3 Freightbillsarealwayscorrect 240 9.12 Analyticalproblems 241 9.13 Discussionquestions 245 9.14 Reviewquestions 247 9.15 Conclusion 247 Furtherreading 249 10. Transportation routing 251 10.1 Introductiontotransportationrouting 251 10.2 Choosingarouteplanningsystem 253 10.2.1 Scheduleandroutetrucksonaday-to-daybasis 253 10.2.2 Maximizefixedroutesandschedules 253 10.2.3 Optimizedeliveriescontinually 253 10.2.4 Supportcustomers 253 10.2.5 Connectwithlivevehicletracking 253 10.2.6 Consider“what-if”situations 254 10.2.7 Usingmultiperiodarranging 254 10.2.8 Makesprogrammingadvancementplans 254 10.2.9 Combinescentralscheduling 254 10.2.10 Focusesonreporting 254 10.3 Vehiclerouting 254 10.3.1 Separateandsingleoriginanddestinationpoints 255 10.3.2 Multipleoriginanddestinationpoints 255 Contents xi 10.3.3 Coincidentoriginanddestinationpoints 256 10.4 Vehicleroutingandscheduling 257 10.4.1 Routingandschedulingmethods 257 10.4.2 Sweepmethod 258 10.4.3 Savingsmethod 258 10.5 Transportationroutinganalysisgeographicinformation system 259 10.6 Freightconsolidation 260 10.7 Hazardousmaterial(HazMat)routingandrisks 260 10.7.1 Factorsusedtocalculatetherisk 264 10.7.2 HazMatroutemodeling 268 10.7.3 Caseanalysis 269 10.8 Advantagesofchoosingtherightroutingsystem 273 10.8.1 Cost 273 10.8.2 Safety 273 10.8.3 Customerloyalty 273 10.8.4 Scalabilitywithspeed 273 10.8.5 Organizationalcontrol 274 10.9 Analyticalproblems 274 10.9.1 Solvingroutingproblemsusingsoftware 277 Reference 280 Furtherreading 280 11. Transportation security 281 11.1 Introduction 281 11.1.1 Whatistransportationsecurity? 281 11.1.2 Safetyversussecurity 282 11.2 Importanceoftransportationsecurity 282 11.3 Cybersecurityinlogisticstransportation 283 11.3.1 Impactofcybersecurityontransportation 285 11.3.2 Benefitsofcybersecuringtransportationassets, goods,andpeople 286 11.3.3 Currentcybersecuritychallenges 288 11.4 Securityriskassessment 291 11.5 Practicalimplications 293 11.6 TransportationsecurityintheUnitedStates 293 11.6.1 NationalSecurityActof1947 294 11.6.2 MaritimeTransportationSecurityActof2002 294 11.6.3 SecurityandAccountabilityforEveryPortActof 2006byDepartmentofHomelandSecurity 294 11.6.4 USDepartmentofHomelandSecurity 295 11.6.5 TransportationSecurityAdministration 296 11.6.6 USCustomsandBorderProtection 296 11.6.7 Cargosecurityinitiatives—C-TPATbyCustomsand BorderProtection 296 11.6.8 SecureFreightInitiativebyDepartmentofHomeland Security 297