Economies of Product Diversity in Collaborative Logistics

Collaborative logistics, also known as shipper collaboration, is a method of reducing the freight logistics cost of firms that produce and/or distribute tangible goods (shippers), which seeks to improve capacity utilizations of trucks. This study looks at this shipper collaboration problem in the U....

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Bibliographic Details
Published inJournal of business logistics Vol. 38; no. 2; pp. 115 - 129
Main Authors Suzuki, Yoshinori, Lu, Shih‐Hao
Format Journal Article
LanguageEnglish
Published Hoboken Blackwell Publishing Ltd 01.06.2017
Subjects
Collaboration
collaborative logistics
Economic theory
integer programming
Logistics
Motor carriers
optimization
Shipping
transportation cost
trucks
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Summary:Collaborative logistics, also known as shipper collaboration, is a method of reducing the freight logistics cost of firms that produce and/or distribute tangible goods (shippers), which seeks to improve capacity utilizations of trucks. This study looks at this shipper collaboration problem in the U.S. truckload (TL) industry and proposes a new approach. Unlike other studies, which focused on reducing TL costs by utilizing economies of density, we present an approach that utilizes specific TL economies gained by mixing multiple products with different weight‐to‐volume ratios, which we call economies of product diversity. Using theoretical and empirical evidence, we show that the performance of shipper collaboration can be enhanced notably using this concept, economies of product diversity, which is currently overlooked in the literature.
ISSN:0735-3766
2158-1592
DOI:10.1111/jbl.12153