VARIETIES OF LOGISTICS CENTRES: DEVELOPING A STANDARDIZED TYPOLOGY AND HIERARCHY C. D. Higgins* Ph.D. Candidate McMaster Centre for Spatial Analysis Burke Science Building, Room 342 McMaster University 1280 Main Street West Hamilton, ON, Canada Phone: (905) 525-9140 ext. 24960 Fax: (905) 546-0663 Email: [email protected]M. Ferguson, Ph.D. Research Coordinator McMaster Institute for Transportation and Logistics General Science Building, Room 206 McMaster University 1280 Main Street West Hamilton, ON, Canada Phone: (905) 525-9140 ext. 20131 Fax: (905) 546-0463 Email: [email protected]P. S. Kanaroglou, Ph.D. Professor/Director McMaster Centre for Spatial Analysis Burke Science Building, Room 342 McMaster University 1280 Main Street West Hamilton, ON, Canada Phone: (905) 525-9140 ext. 24960 Fax: (905) 546-0663 Email: [email protected]*: Corresponding Author Word Count: 7330 Tables: 4 Figures: 3 TRB 2012 Annual Meeting Paper revised from original submittal.
TRB 2012 Annual Meeting Paper revised from original submittal.
C.D. Higgins, M. Ferguson & P.S. Kanaroglou 2
ABSTRACT 1 Despite the growing interest in the development of intermodal logistics centres by scholars in 2 academia and public and private sector actors, a consensus on the definitions of these centres 3 does not yet exist. The purpose of this paper is to explore the previous literature and propose a 4 unified and standardized typology and hierarchy of logistics centres. Several current terms and 5 definitions are presented and used to establish criteria for the creation of a combined typology of 6 logistics centres. This information is then used to form a hierarchy of facilities according to their 7 size, influence, value added activities, and function in freight and logistics processes. The 8 resulting typology and hierarchy is useful as a foundation for advancing future research in this 9 area. 10
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1. INTRODUCTION 1 A new generation of intermodal logistics and distribution facilities has emerged around 2
the world, facilitated by changes in freight and logistics processes, and in response to the 3 challenges posed by regional population and freight growth. Loosely termed „logistics centres‟, 4 these facilities have become fundamental elements of local, national, and international 5 transportation systems in regions with high volumes of trade. 6
However, in examining the academic literature on logistics centres, it is clear that this 7 phenomenon has not yet received an agreed upon name (1-4). Many common, though imprecise 8 terms have been identified to describe these centres, such as freight hub, freight gateway, inland 9 port, inland terminal, dry port, and freight village. These definitions cover a wide variety of 10 roles and scales, as some facilities are simple terminals with singular functions, while others are 11 complex partnerships and legal entities that include logistics zones and governance structures 12 (4). 13
This raises many questions: Why is there so much variation in the literature? What do 14 these terms mean? To what extent are they interchangeable? And what type of facility would 15 best suit the needs of policymakers and planners interested in the benefits these facilities can 16 provide? The answer to these questions is essential as the issue of facility definition plays a 17 fundamental role in any research undertaking by scholars in academia and actors in the public 18 and private sectors. 19
This paper proposes a standardized typology and hierarchy of logistics centres that will 20 help to evolve this area towards a more coherent and integrative field of study. This will be 21 accomplished by: (1) working towards a functional classification of the different logistics centres 22 encountered in the literature; (2) assembling this classification into a combined logistics centre 23 typology; (3) providing consolidated definitions of the different types of facilities; and (4) 24 organizing these facilities into a functional logistics centre hierarchy based on their value added 25 activities in the supply chain and function in regional freight and logistics processes. 26
The goal of this paper is to establish the proposed standardized typology and hierarchy of 27 logistics centres as a foundation for future research in this area that will enable scholars and 28 policymakers to better understand the function, scale, and expected benefits of these centres and 29 direct strategic investments in the development of intermodal logistics networks. 30
The structure of this paper is as follows. Section 2 illustrates the lack of consensus in the 31 literature by presenting several common terms and definitions used in relation to logistics 32 centres. Section 3 examines and critiques previous attempts at classifying the different types of 33 logistics centres and establishes the criteria for working towards a functional typology. Section 4 34 utilizes this work to propose a consolidated logistics centre typology, new standardized facility 35 definitions, and a hierarchy based on their function and scope. The paper then offers conclusions 36 and directions for future research in Section 5. 37
38 2. LITERATURE REVIEW 39
As a relatively new area of study, the research on intermodal logistics centres suffers 40 from a lack of clarity and consensus among authors in the field. Rimienė and Grundey (2, p. 92) 41 argue that “logistics researchers have made little effort to build a unified logistics conception” 42 and according to Tsamboulas and Dimitropoulos (5, p. 382), a distinctive characteristic of the 43 research has been “the apparent absence of standard methodologies or decision criteria.” This 44 can be attributed to a history of theory development and empirical research that is poor in 45 comparison to other disciplines, which is due to the ongoing evolution of freight and logistics (2, 46
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C.D. Higgins, M. Ferguson & P.S. Kanaroglou 4
6-7), and regional geographic and semantic considerations that cause the concepts and functions 1 of these facilities to vary according to local, regional, and national characteristics (3-4). 2
An additional issue is the definition of intermodal transportation and its effects on 3 defining intermodal logistics centres. Like logistics centres, Bontekoning et al. (8) argue 4 research on intermodal transportation is currently immature with little coherence in research 5 areas, collaboration among scholars, and consensus on definitions. For example, Tsamboulas 6 and Kapros (9) view intermodal transportation as a process requiring the utilization of two or 7 more different transport modes where the goods remain in one and the same transport load for 8 the entire journey. This definition appears to eliminate the possibility of moving goods between 9 a single mode, such as truck-to-truck or rail-to-rail transshipment. However, other authors 10 subtract this requirement, such as Slack (10) who argues that intermodal transportation 11 constitutes only the integration of shipments across modes. Notteboom and Rodrigue (3) agree, 12 arguing that the transloading, cross-docking, and warehousing of freight between a single mode 13 constitutes intermodal transportation. 14
A consequence of these issues has been the fragmented development of terminology and 15 definitions used to describe the logistics centre phenomenon. Table 1 presents an overview of 16 some of the terms and definitions encountered in the literature. While some of these are similar, 17 each author presents a different conceptualization and definition of the observed facility. 18
The variation in the literature highlights the confusion surrounding the concepts and 19 definitions of these logistics centres, and brings to question their usefulness as terms to guide 20 further study. For example, as explained by Roso et al. (11), the term „dry port‟ is often used to 21 refer to a terminal where various cargo handling and added value activities are performed, 22 directly connected to a major seaport with rail or barge shuttle services. But according to 23 Rodrigue et al. (4) this makes dry ports an issue of contention, as „dry‟ appears to exclude other 24 inland terminals served by barge. Even between countries, similar facilities are named 25 differently. What Tsamboulas and Dimitropoulos (5) refer to as nodal centres for goods are 26 called freight villages in the United Kingdom, Platformes Multimodales/Logistiques in France, 27 Interporti in Italy, and Gueterverkehrszentren (GVZ) in Germany. 28
The term „logistics centre‟ itself is subject to confusion, with some authors referring to it 29 as a concept covering the “broadest meaning” of a centre for companies participating in activities 30 related to transportation and logistics (1, p. 106), while others view logistics centres as functional 31 equivalents of freight villages in Europe, Japan, Singapore, China, and the USA (2, 12-13). 32 Furthermore, while some of the authors discussed in Section 3 have incorporated these terms into 33 the development of their own logistics centre typologies, others have proposed additional names 34 and definitions, further fragmenting the standardization of research in this area. 35
36 3. TOWARDS A LOGISTICS CENTRE TYPOLOGY AND HIERARCHY 37 Despite the multiplicity of terms observed in the literature, some authors and 38 organizations have proposed their own classification typologies and hierarchies of logistics 39 centres. However, many exist in isolation from the previous literature and do not accommodate 40 the different types of facilities seen in the research and in practice around the world. This section 41 provides a brief overview of these works. They are then evaluated to establish criteria for the 42 development of a standardized typology and hierarchy of logistics centres. 43 44
45 46
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TABLE 1 Terms Used in Relation to Logistics Centres 1 2 Term Author
Maritime Feeder Inland Port Leitner & Harrison (2001)
Nodal Centres for Goods Tsamboulas & Dimitropoulos (1999)
Satellite Terminal Notteboom & Rodrigue (2009)
Satellite Terminal Slack (1999)
Seaport Dooms & Macharis (2003)
Trade and Transportation Centre Inland Port Leitner & Harrison (2001)
Transfer Terminal Wiegmans, et al. (1999)
Transmodal Terminal Notteboom & Rodrigue (2009)
Transport Terminal Rimienė & Grundey (2007)
Urban Consolidation Centre BESTUFS (2005)
Urban Distribution Centre de Cerreño, et al. (2008)
Warehouse Rimienė & Grundey (2007)
3 4 5
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Logistics Centre Typologies 1 Some authors have attempted to categorize the variety of logistics centres according to different 2 criteria. Below is a concise discussion of these approaches, with a more detailed outline 3 presented in Table 2. 4
The United Nations Economic and Social Commission for Asia and the Pacific 5 (UNESCAP) (16) has developed a comprehensive typology of five different types of intermodal 6 logistics centres according to their design, function, and role, ranging from the simple functions 7 of a container yard to the broad activities performed at a freight village. 8
Based on a review of different terms used in the literature, Rimiene and Grundey (2) 9 propose a classification of six different types of logistics centres based on their function and 10 scope of activities in freight and logistics, ranging from the singular function of warehousing to 11 the conceptualization of „logistics nodes‟ as integrators of different transport modes with large 12 freight flows and extensive regional influence. 13
Working under the rubric of inland ports, Leitner and Harrison (14) classify the 14 development of logistics centres into different categories according to their primary mode of 15 transportation. This includes inland waterway ports, airfreight facilities, the relief of maritime 16 ports through road and rail shuttles for inland consolidation, and sites that host a range of road 17 and rail connections and add value to goods. Notteboom and Rodrigue (3) take a similar 18 approach, arguing that there are three major types of intermodal terminals, each with their own 19 locational and equipment requirements. These consist of port terminals, rail terminals, which 20 have a subdivision of three types of inland ports (satellite terminals, load centres, and transmodal 21 terminals), and distribution centres that perform transloading, cross-docking, and warehousing 22 operations. 23
Lastly, Wiegmans et al. (15) provide an alternate classification of terminal types based on 24 the volume of freight flows and the corresponding network characteristics. This typology ranges 25 from bulk terminals that handle large volumes of global freight to hinterland terminals that 26 consolidate small shipments into bigger freight flows. These are also organized according to 27 four types of freight bundling flows and network organizations, such as the point-to-point 28 bundling model, the hub-and-spoke network, the line network, and the trunk line with collection 29 and distribution. 30
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TABLE 2 Logistics Centre Typologies
Leitner & Harrison (2001)
Inland Waterway
Port
These ports are not a new concept in international and domestic freight movement and provide one of the most efficient means for the
transport of bulk cargo. This can be considered an inland port by virtue of its inland location and volume of goods transported.
Air Cargo Port Air cargo ports exist in conjunction with passenger facilities but are becoming more common as dedicated cargo ports. Commonly
used to ship high-value, time-sensitive goods. Some facilities incorporate customs, distribution facilities, and in some cases
manufacturing centres.
Maritime Feeder
Inland Port
The concept behind this class of inland port is to provide a deconsolidation point for cargo shipped to a congested maritime port.
Typically located between 50 to 250 miles from the mainport to allow the mode shift of freight from road to rail and relieve
congestion, though major inland links can include highways and inland waterways as well.
Trade and
Transportation
Centre Inland Port
This general class can be looked at as a location where border processing of trade is shifted inland and multiple modes of
transportation are available. A distinguishing feature is the ability to be at locations where value is added to goods. Many examples in
the United States are located on decommissioned air force bases or large greenfield areas, though sites can range from a single facility
where intermodal connections and manufacturing centres are located, to an entire city or region that facilitates international trade.
Notteboom & Rodrigue (2009)
Port Terminals The most substantial intermodal terminals in terms of traffic and land consumption, providing an interface between the maritime and
inland systems of circulation. Barging has also emerged to extend the economies of scale offered in maritime container shipping.
Rail Terminals Connected to port terminals to form the inland intermodal chain. These can be broken down further into three types of facilities:
Satellite Terminals: Linked to maritime terminals through rail shuttle or drayage and perform activities that have become too
expensive for the maritime terminal.
Load Centres: Standard intermodal rail terminals serving a regional market. When combined with other logistics activities such as
freight distribution, they can take on the form of a freight village.
Transmodal Terminals: Shift containerized freight from one rail carrier or rail network to another during long distance
transportation.
Distribution
Centres
Represent a distinct category of intermodal terminals performing an array of value-added functions to freight, with operations mainly
supported by trucking. These functions include:
Transfers: The contents of maritime containers are transferred into domestic containers or truckloads.
Cross-Docking: The contents of inbound loads are sorted and transloaded to their final destinations.
Warehousing: A standard function still performed by a majority of distribution centres that act as buffers and points of
consolidation and deconsolidation in supply chains.
Rimienė & Grundey (2007)
Logistics Node Points that gather and connect different transport modes and give an opportunity to serve cargoes that flow from different directions.
Nodes include major seaports and other large-scale terminals that are seen as complimentary to inland logistics centres.
Freight Village Seen as synonymous with logistics centres, differing only in scale. Typically, only larger logistics centres are considered a freight
village, offering a broader range of services, infrastructure, and integration to facilitate the flow of goods. Freight villages with
considerable influence in regional trade flows can also be considered a logistics node.
Logistics Centre A village planned and built to best manage all the activities involved in freight movement. Logistics centres are seen as promoters of
local consolidation, intermodal transportation, and regional economic activity.
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Transport Terminal Points of concentration at which traffic between urban areas ends its journey, or is interchanged for further movement to its ultimate
destination. Transport terminals can range from simple terminals providing transfer between two or three modes, to more extensive
facilities providing a number of value-added services. The latter approach the scope of activities of a logistics centre or freight village.
Distribution Centre A warehouse that emphasizes product flow rather than the storage of goods. Later conceptions of distribution centres focus on
distribution centres as a place located at nodal points in the transportation system where consignments are grouped or split. These
activities approach the definition of a transport terminal or logistics centre.
Warehouse Can be as simple as an intermediate storage point between suppliers and manufacturers to smooth the relationship between time and
demand, to a more complex facility for performing distribution, maintenance, and value-added services. The complex-type warehouse
can be seen to be virtually synonymous with a distribution centre.
UNESCAP (2009)
Freight Village An area of land dedicated to a number of transport and logistics facilities, activities and services, which are not just co-located but also
coordinated to encourage maximum synergy and efficiency. Distinguishing features include an intermodal terminal and shared access
to facilities and services.
Dry Port Provides all the services of a port except for the loading of cargo to and from seagoing ships. In comparison to container depots, it can
accommodate all types of cargo, not just containers. Typically provides all of the features of the facilities above.
Intermodal
Terminal
Enables containers to be transferred from road to rail or rail to road. Can be an efficient method for moving high volumes of freight
from one inland location to another, and typically incorporates the services of the other terminals in the ESCAP typology.
Inland Container
Depot
Adds to the functions of a container yard through customs clearance and inspection services. Performs the same role as a port
container terminal in addition to break-bulk handling and other container services.
Container Yard Dedicated to the temporary storage, cleaning, and repair of empty containers. Sometimes located near to a seaport to improve import /
export container turnaround time.
Wiegmans, et al. (1999)
Bulk Terminal This is the mainport with large volumes and global freight connections. Bulk refers to large volumes and not to bulk freight. Large
flows arrive at the terminal and are split into smaller flows for further transport. These terminals are noted by grand storage areas,
rapid loading and unloading, intensive use of IT, and intelligent terminal transport. Utilizes the point-to-point bundling model.
Transfer Terminal Almost exclusively aimed at shipping continental freight. There is almost no collection and distribution in the region where the
terminal is located. Freight arrives and departs in huge flows and the terminal is characterized by large areas that enable direct
transshipment between trains and/or barges. Utilizes the hub-and-spoke network.
Distribution
Terminal
At this terminal, added value is created in the form of an extra service provided by the terminal operator. From locations A, B and C,
continental freight arrives at the terminal and is consolidated into shipments for customers X, Y, and Z. One or more terminal services
are added by the terminal operator to the shipments at the terminal. Utilizes the line network.
Hinterland
Terminal
Small continental cargo shipments are brought to the hinterland terminal and consolidated into bigger freight flows. These bigger
freight flows are further transported by larger transport means, such as trains or barges. Utilizes the trunk line bundling model.
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Logistics Centre Hierarchies 1 Some authors have then applied the terminology to the development of hierarchical 2 classifications of logistics centres according to different criteria. For example, Wiegmans et al. 3 (15) classify five different types of freight terminal based on geographical coverage, volume, and 4 terminal capacity, ranging from the intensive operations of a „XXL or Mainport Terminal‟ such 5 as a major seaport to the small-scale operations at a „S or Local Terminal‟. A detailed overview 6 of this hierarchy is provided in Table 3. 7
After a comprehensive literature review of various definitions of logistics centres, 8 Rimienė and Grundey (2) produced a 3-level hierarchy of their classification of logistics 9 facilities according to their role in the supply chain and similarities to one another (Figure 1). 10 According to Rimienė and Grundey (2), the 1
st level indicates the smallest scope of activities, 11
with the highest scope defined by the 3rd
level. The intersection arrows between different levels 12 show that the names of connected facilities can transfer between levels depending on the 13 individual activities of each centre, and the definition employed by individual authors. The 14 closest connections in definition are represented by unidirectional arrows. 15
16 FIGURE 1 Logistics Centre Hierarchy. 17
18 (2, p. 89) 19
20 Notteboom and Rodrigue (3) have expanded on their categorization of logistics centres 21 and utilize them to form a functional and added value hierarchy (Figure 2). The categories in 22 this example are grouped according to three levels ranging from the broad transportation and 23 value added activities at a „Gateway (Level 1)‟ terminal, to the specific function performed by a 24 „Satellite Terminal (Level 4)‟. A more detailed overview is provided in Table 3. According to 25 Notteboom and Rodrigue (3), the functions of inland logistics zones and facilities ranges from 26 simple cargo consolidation to advanced logistics services. Many locations have assumed not 27 only a significant number of traditional cargo handling functions and services, but have also 28 attracted many additional logistics services, acting as distribution centres, shipping agents, 29 trucking companies, freight forwarders, container repair facilities and packing firms. This 30 classification shows the clustering of inland terminals and logistics activities, and also the degree 31 of specialization each offers with respect to different freight and logistics processes. These 32
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facilities have become excellent locations for consolidating a wide range of ancillary logistics 1 services and a host of logistics companies. 2 3
FIGURE 2 Freight Terminal Hierarchy and Added Value. 4 5
6 (3, p. 9) 7
8 Summary and Evaluation 9 The approaches outlined above make an attempt to distinguish between the different types of 10 logistics centres according to varying criteria. But as these demonstrate, there exists no 11 standardized approach to conceptualizing the variety of facilities encountered in the literature 12 and their role in freight and logistics processes. Like the terminology outlined in Section 2, these 13 approaches appear to be limited in their scope, level of analysis, and applicability for further 14 study due to the immaturity of the research field, the evolution of freight and logistics, and the 15 regional geographic and semantic considerations mentioned previously. 16
Many of these examples exist in isolation from one another, discussing similar concepts 17 but making no attempt to unify research in this area. Of these works, only Rimienė and Grundey 18 (2) have made an explicit attempt to integrate the terminology on logistics centres based on a 19 literature review. However, their approach falls short in accommodating the various types of 20 facilities mentioned by other authors and their distinct roles in freight and logistics. 21
Yet while the usefulness of these typologies and hierarchies to guide further study 22 appears limited, they are useful for the development of a standardized typology and hierarchy in 23 two ways. The first is that these examples demonstrate that although differences in logistics 24 centres do exist, the concepts, characteristics, and relationships between terminal types are 25 similar enough that functional classifications between terminal types can be delineated. 26 The second way these examples benefit the development of a standardized approach is 27 through establishing criteria that can be used for further analysis. In order to assemble a 28 standardized typology, this paper will utilize these works to consider the definitions of logistics 29 centres according to their design, function, primary mode of transportation, volume of freight 30 flows, and role and scope of activities in freight and logistics. The results of the typology can 31 then be applied to create a standardized hierarchy according to facility size (site, volume of 32
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freight, capacity), influence (geographic coverage), and scope of functionality and value added 1 activities. 2 3 TABLE 3 Logistics Centre Hierarchies 4 5
Notteboom & Rodrigue (2009)
Gateway
(Level 1)
World-class gateway terminals that function as an interface between regional and
international transportation systems. Gateways contain the whole range of value added
activities related to freight and logistics, though basic gateways focusing only on
transshipment between maritime and inland transportation networks do exist.
Freight Distribution
Cluster (Level 2)
Characterizes a complex of large inland terminals and freight distribution centres that
cover a vast market area. Some can have as much value added activities as a gateway.
Inland Port
(Level 3)
Often a single intermodal terminal coupled with an array of distribution activities.
Commonly acts as a load centre for commodity chains.
Satellite Terminal
(Level 4)
Performs a specific function such as transloading, often in the vicinity of a major gateway.
Some satellite terminals are very significant in providing specialized freight distribution
services.
Wiegmans, et al. (1999)
XXL or Mainport
Terminal
Abundant deep-sea, rail, truck, and barge connections throughout the world.
Characterized by low costs, high volumes, high capacity utilization, IT-intensive
operations, and heavyweight global logistics players involved. Usually a mainport will
either be a major seaport or a large airport with worldwide connections.
XL or International
Terminal
Characterized by deep-sea, rail, truck, and barge connections in a more continental level.
Especially used as an international distribution centre.
L or National
Terminal
Operated on the country level and has rail, barge, and truck connections. Used as a
national distribution centre in Europe.
M or Regional
Terminal
Characterized by low cost through low budget solutions, relatively low volumes and IT-
components in operations, and smaller regional and national logistical players. Used as a
regional distribution centre with truck and rail or barge connections.
S or Local Terminal Only served by trucks that collect and distribute freight to and from their final destination.
A simple connection with rail or barge is provided.
6 4. THE DEVELOPMENT OF A STANDARDIZED LOGISTICS CENTRE TYPOLOGY 7 AND HIERARCHY 8 Despite their limitations, the definitions and approaches in Section 3 provide a useful framework 9 for developing a unified typology and hierarchy of logistics centres that can account for much of 10 the variation in the literature. This section develops a standardized logistics centre typology and 11 applies it to the creation of a standardized hierarchy. This is followed by an overview of the 12 consolidated definitions of logistics centres and a discussion of the limitations of the approach. 13 14 Standardized Logistics Centre Typology 15 In order to address the lack of standardized definitions in the research, this paper will first 16 develop a unified typology of logistics centres by extracting common themes from the 17 definitions, typologies, and hierarchies presented above and applying them to the criteria 18 outlined in Section 3. Using these criteria, the various definitions of logistics centres in the 19 literature can be broken down into six categories and three levels of activity as shown in Table 4, 20 with each term located relative to its definition and the definitions of those above and below it. 21 This classification combines and expands on other authors in the field, with particular emphasis 22 on Wiegmans et al. (15), Leitner and Harrison (14), Meidutė (1), Rimienė and Grundey (2), 23 Notteboom and Rodrigue (3), and the United Nations ESCAP report (16). 24
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TABLE 4 Consolidated Logistics Centre Classification and Scope of Activities
Terminal
Sizea
Logistics
Facilities
Hierarchyb
Functional
Hierarchyc
Facility Terminology Consolidated
Classification
Consolidated
Scope of
Activities
XXL
XL
L
M
3rd
Level Gateway
(1st Level)
Gateway (Notteboom & Rodrigue, 2009)
Mainport Terminal
3rd
Level
(Gateway
Cluster)
Logistics Node (Rimienė & Grundey, 2007)
Seaport (Dooms & Macharis, 2003)
Air Cargo Port (Leitner & Harrison, 2001)
Bulk Terminal (Wiegmans et al. 1999)
2nd
Level
Freight
Distribution
Cluster
(2nd
Level)
Nodal Centres for Goods (Tsamboulas & Dimitropoulos, 1999)
Freight Village
2nd
Level
(Freight
Transportation
and Distribution
Cluster)
Freight Village (UNESCAP, 2009)
Freight Village (Rimienė & Grundey, 2007)
Freight Village (Tsamboulas & Kapros, 2003)
Freight Village (Boile et al. 2008)
Logistics Centre (EUROPLATFORMS, 2004)
Logistics Centre (Meidutė, 2005)
Logistics Centre (Rimienė & Grundey, 2007)
Trade and Transportation Centre Inland Port (Leitner & Harrison, 2001)
Inland Port
(3rd
Level)
Load Centre (Notteboom & Rodrigue, 2009)
Inland Port
Inland Port (UNECE 2001)
Dry Port (Ng & Gujar, 2009)
Dry Port (Roso, et al. 2009)
Dry Port (UNESCAP, 2009)
Inland Port (Rodrigue et al. 2010)
Maritime Feeder Inland Port (Leitne r & Harrison, 2001)
Satellite
Terminal (4th
Level)
Hinterland Terminal (Wiegmans et al. 1999)
Satellite Terminal (Notteboom & Rodrigue, 2009)
Satellite Terminal (Slack, 1999)
Inland Waterway Port (Leitner & Harrison, 2001)
Barge Terminal (Notteboom & Rodrigue, 2009)
Transport Terminal (Rimienė & Grundey, 2007)
Intermodal
Terminal
Intermodal and Multimodal Industrial Park (Boile et al. 2008)
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Standardized Logistics Centre Hierarchy 1 The information from the above classification typology is then applied to form a hierarchy of 2 logistics centres according to each facility‟s size, influence, and function in regional freight and 3 logistics and value added activities (Figure 3). This hierarchy collapses the five sizes in 4 Wiegmans et al. (15) and the four levels presented in Notteboom and Rodrigue (3) into three 5 broad levels based on the scope of activities in Rimienė & Grundey (2). This approach presents 6 a practical logistics centre typology and hierarchy that serves to simplify and differentiate 7 between the varieties of facilities seen in the literature. In general, as these facilities move up the 8 scale in functionality and value added services they can be understood to incorporate and expand 9 on many of the features of the logistics centres below them in the hierarchy. 10 11
FIGURE 3 Standardized Logistics Centre Hierarchy. 12 13
14 15 Standardized Definitions of Intermodal Logistics Centres 16 Utilizing the above typology and hierarchy as a conceptual framework, the definitions provided 17 by the authors cited can be applied to form standardized definitions of the eight consolidated 18 types of intermodal logistics centres. 19 20 1
st Level: Warehousing and Distribution Cluster 21
The 1st level represents the smallest scope of activities performed by intermodal logistics centres 22
and generally fit the S size terminals outlined by Wiegmans et al. (15). Warehousing and 23 Distribution Centres perform a variety of logistics functions and serve as important basic 24 elements in the supply chain. Also included are the UNESCAP‟s (16) basic Container Yards that 25 help facilitate containerized trade, and Inland Container Depots that offer a greater set of services 26 tailored to containerized trade over container yards. 27 28
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Warehouse: Warehouses are typically a place for inventory and storage and perform the basic 1 function of acting as a buffer between suppliers, manufacturers, and customers to smooth time 2 and demand constraints in the supply chain. Some warehouses are more complex, performing 3 distribution, maintenance, and value added activities and can approach the functional scale of 4 distribution centres. 5
6 Distribution Centre: Distribution centres are a single large warehouse or cluster of warehouses 7 dedicated to the rapid movement of goods. Basic functions include warehousing, shipping, 8 receiving, transloading, and cross-docking, while some have evolved to add ancillary value 9 added services such as order picking, returns processing, information management, labeling, 10 barcoding, and other activities. Unlike a warehouse, the primary emphasis of a distribution 11 centre is on product flow rather than the storage of goods. Some facilities are specifically 12 designed to increase the efficiency of urban goods movement by providing a shared facility 13 within an urban area at which different companies can consolidate and deconsolidate their 14 shipments into fewer or smaller trucks for local delivery. Broader conceptions of distribution 15 centres that host logistics and other firms, offer access to other modes, and perform a wide array 16 of activities can begin to resemble other facilities higher in the hierarchy such as freight villages. 17 18 Container Yard: A container yard is a facility dedicated to performing the basic functions of 19 storage, cleaning, and repair of empty containers. Like a warehouse, these facilities act as a 20 buffer in the transport chain by ensuring a smooth supply of containers to facilitate the 21 movement of goods. These facilities can be located near a mainport terminal or other logistics 22 centres as a way to improve service and handling turnaround times. 23 24 Inland Container Depot: Inland container depots offer a location for the handling and 25 temporary storage of containerized trade. Similar to distribution centres, the focus of an inland 26 container depot is on the movement of containers rather than storage. Unlike a container yard, 27 an inland container depot performs some of the functions of a traditional seaport container 28 terminal other than ship to shore transfer. This can include container handling and storage, 29 break-bulk cargo handling and storage, and additional value added services such as basic 30 customs clearance and inspection. 31 32 2
nd Level: Freight Distribution Cluster 33
The 2nd
level represents the freight distribution cluster, which has been expanded from 34 Notteboom and Rodrigue (3) in accordance with the definitions of these facilities by other 35 authors. It now encompasses Intermodal Terminals, Inland Ports, and Freight Villages, and 36 loosely covers the M and L size terminals in Wiegmans et al. (15) with the biggest approaching 37 the scale of an XL terminal. The activities performed by these facilities range from the simple 38 transfer of goods from one mode to anther at an intermodal terminal, to the broad range of 39 intermodal transportation options, wide geographic influence, and comprehensive value added 40 services offered by freight villages. 41 42 Intermodal Terminal: An intermodal terminal is a facility dedicated to the transshipment and 43 consolidation of intermodal freight into bigger flows for regional and continental trade. 44 Intermodal terminals handle large freight flows and feature intermodal infrastructure for the 45 transshipment of goods between rail, road, and other modes such as barge for further 46
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C.D. Higgins, M. Ferguson & P.S. Kanaroglou 16
transportation to their final destinations. Some intermodal terminals can incorporate the value 1 added and logistics functionality of a freight village with the exception of commercial support 2 services and activities, while others perform singular functions as a terminal dedicated to 3 transshipment between modes. 4 5 Inland Port: An inland port can be understood as an inland extension of a traditional seaport, 6 connected to the mainport terminal by a high-capacity rail shuttle or barge link for short sea 7 shipping. The scope of activities at an inland port can range from intermodal „satellite‟ terminals 8 dedicated to „extending the gate‟ of mainport terminals by consolidating freight flows for further 9 transport by barge or train or deconsolidating incoming freight for local distribution. Other 10 inland ports can resemble freight villages by offering a variety of transport modes, warehousing 11 and distribution activities, and value added services such as customs clearance and inspection. 12
Inland ports typically provide the range of additional services offered by inland container 13 depots and container yards. But unlike these facilities, an inland port can accommodate all types 14 of cargo in addition to containers and offers full customs-related services. By providing all of 15 the services of a traditional seaport other than the actual loading and unloading of cargo from 16 maritime vessels, inland ports can mitigate congestion at mainport terminals. This can include 17 functions such as freight assembly, storage, and logistical control. Furthermore, as a 18 consolidation and deconsolidation point for maritime freight flows, inland ports offer firms the 19 benefits of massification for achieving economies of scale. 20 21 Freight Village: A freight village is a site or area hosting a cluster of industrial, intermodal, 22 distribution, and logistics infrastructure and supporting services dedicated to facilitating the flow 23 of goods. A central feature of a freight village is high quality connections to intermodal and 24 other transportation infrastructure (road, rail, air, barge) that enables the fast and flexible 25 transportation of freight. Some freight villages add urban consolidation and distribution 26 functions to improve the efficiency of urban goods movement. 27
A distinguishing characteristic of a freight village is shared access to facilities, 28 equipment, and services among firms located on site. This can include common intermodal 29 infrastructure, customs and quarantine services, cleaning and repair areas, IT and 30 telecommunications, security areas, and amenities such as restaurants and childcare facilities. 31
Because of the size of investment required, many freight villages are financed through 32 partnerships between public and private actors, though examples of purely private facilities exist. 33 Due to the complexity of these arrangements, freight villages typically feature a joint 34 management and ownership structure. This company is responsible for owning and operating 35 common infrastructure as well as planning the long-term growth of the facility. 36
Though the size of their sites can vary significantly, freight villages are the largest inland 37 facilities at the top of the logistics hierarchy due to the size of their influence and impact in 38 freight and logistics. These logistics centres add the most value to the supply chain by offering a 39 host of facilities, services, infrastructure, and activities related to freight and logistics that are 40 both co-located and coordinated to encourage maximum efficiency between tenants on site. By 41 combining major freight generators with multiple modes of transportation, logistics activities, 42 and commercial support services at a location near major urban and regional markets, a freight 43 village can have a large impact on a number of freight-related processes. The biggest freight 44 villages with sufficient infrastructure and considerable influence in regional trade flows can 45 approach the level of being considered a mainport terminal. 46
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3rd Level: Gateway Cluster 1 The 3
rd level defines the largest scope of activities contained within major international mainport 2
terminals. This includes facilities described as XXL and XL terminals by Wiegmans et al. (15), 3 Logistics Nodes by Rimienė & Grundey (2), and Gateways by Notteboom and Rodrigue (3). 4 5 Mainport Terminals: As the primary interface between maritime and inland freight and 6 logistics, mainport terminals act as nodal centres for logistics that produce large amounts of 7 activity both inside the facility and within its periphery. This includes major seaports that 8 transfer large volumes of freight from maritime to inland transportation systems and other large-9 scale terminals such as airports with worldwide connections and high trade and passenger flows. 10 Large volumes of freight arrive at the terminal and are split into smaller shipments for further 11 transport, though these flows have enough volume to fill an entire train, barge, or ship. This 12 relationship is inversed for consolidating outgoing shipments. 13
As the largest logistics centres, mainport terminals require vast amounts of investment in 14 infrastructure and consume an immense amount of land for terminal operations. These terminals 15 have a large economic impact, generate high levels of employment, provide vast areas for 16 storage, feature heavy duty infrastructure to facilitate rapid loading and unloading, utilize IT and 17 other technologies extensively, and contain the whole range of value added activities related to 18 freight and logistics. These facilities are complimentary to inland intermodal logistics centres 19 and act as the main gateway between international supply chains. 20 21 Discussion 22 As a simplified and functional classification, the presented standardized typology and hierarchy 23 of intermodal logistics centres is unique in its accommodation of the varieties of facilities seen in 24 the literature. However, such an approach is not without its limitations. First, it should be noted 25 that any subdivision of terminal types cannot cover the variation of logistics centres seen in 26 practice unambiguously. The categories of logistics centres presented are not exclusive, as many 27 examples take on characteristics of two or more terminal types according to their function, 28 operations, location, and other regional geographic and semantic considerations. This is 29 represented in Table 4 by dotted lines that indicate connections between various classifications. 30 Secondly, this classification does not accommodate facilities that do not incorporate 31 access to freight transfer infrastructure or engage in freight and logistics activates. A related 32 issue is that this typology only considers logistics centre facilities. This excludes broader 33 conceptualizations of freight and logistics centres as entire cities or regions that facilitate trade, 34 as seen in the definition of a „Trade and Transportation Centre‟ by Leitner and Harrison (14). 35
A third limitation is that the ongoing evolution of freight and logistics and the centres that 36 facilitate these activities means that the definitions of these facilities are likely to change over 37 time. For example, some of the older definitions cited in Table 1 are not included in this 38 typology, such as those in UNCTAD (18, 24) and UNECE (21). Though these provide some of 39 the first descriptions of the logistics centre phenomenon, the defined roles and conceptualizations 40 of these facilities have become too general and ambiguous compared to more recent definitions 41 to be considered as a guide for further analysis. 42
Lastly, this typology relies on a more general interpretation of intermodal transportation 43 to classify the varieties of facilities seen in the literature. For example, Boile et al. (20) identify 44 „Industrial Parks‟ that are supported only by trucking as a freight and logistics facility. By 45 employing the more general definition of intermodal by Notteboom and Rodrigue (3), this 46
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C.D. Higgins, M. Ferguson & P.S. Kanaroglou 18
facility can be accommodated in the typology. However, based on a strict interpretation of 1 intermodal as a transportation process employing at least two different modes as seen in 2 Tsamboulas and Kapros (9), these facilities would not be considered an intermodal logistics 3 centre. 4 5 5. CONCLUSION 6
As a relatively new area of study, the lack of consensus on definitions provides an 7 opportunity to propose a unified and standardized typology and hierarchy of intermodal logistics 8 centres. This paper has sought to resolve the multiplicity of terms observed in the literature by 9 classifying and defining the different types of facilities and applying them to a hierarchy 10 according to their size, influence, and scope of value added activities and functionality in freight 11 and logistics processes. This research has identified eight different types of intermodal logistics 12 centres: warehouses, distribution centres, container yards, inland container depots, intermodal 13 terminals, inland ports, freight villages, and mainport terminals. 14
The presented typology and hierarchy is unique in its accommodation of the varieties of 15 facilities seen in the literature. By combining and expanding on the work of other authors in the 16 field, this paper is the first to reconcile previous approaches and fully address the critical issue of 17 facility identification. Additionally, the establishment of a standard theoretical foundation 18 enables opportunities for future research in further developing the proposed facility definitions 19 according to characteristics such as ownership, governance, employment, and economic impact. 20 As such, we recommend that researchers and practitioners adopt the conceptualizations proposed 21 in this paper as a solution for the advancement of research in this area. 22
The categories of logistics centres identified herein should not be considered exclusive. 23 Many facilities can take on the roles of one or more different types according to their local, 24 regional, and national geographic and semantic considerations. Furthermore, the definition of 25 intermodal transportation remains in flux, and it is expected that the role of some facilities is 26 likely to change over time as freight and logistics continues to evolve. 27
Nevertheless, the establishment of a standardized intermodal logistics centre typology 28 and hierarchy will allow logistics researchers to progress this field towards a more advanced area 29 of inquiry and enable scholars in academia and the public and private sectors to more accurately 30 define the type of facility that best meets their needs and goals and direct their investments 31 accordingly. 32 33 REFERENCES 34
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