An Analysis of Logistics Drivers in Urban Areas; Drivers, impediments, and Implications
Introduction
The term logistics has been used for centuries to refer to a number of activities that facilitate trade and specifically the movement of goods and services from the point of origin through to the final destination i.e. the consumer. Logistics therefore is the management of resources between the points of origin and the point of consumption. It involves among many factors, the management of physical goods such as food, materials and equipment etc. as well as the management of abstract items such as production, transportation, warehousing and security etc. In a nut shell, the management of logistics is the practice of managing the supply chain to ensure that it is effective and efficient in delivering products (goods or services) from the producers to the consumer. Hence, logistics management involves the planning, implementation and control of the supply chain. In essence, logistics management activities ensure the effectiveness and the efficiency of the supply chain by guaranteeing sustainability of the forward-revere flow and storage of goods and services. Similarly logistics as well ensure the information related to the flow of goods and services between the points of origin and final destination i.e. producer and consumer respectively is smooth sailing to facilitate the same. There are numerous benefits that accrue to stake holders as a result of supply chain management. For instance, it helps in cost reduction while it improves service delivery, customer satisfaction, asset utilization, and profit generation. Notwithstanding, logistics as well pose several challenges especially in urban areas such as pollution. The environmental impact of logistics in the movement of products and in the management of the supply chain has detrimental effect on human health as well as on the physical environment.
This paper details literature on logistics in urban areas divulging into the factors influencing logistics in urban centers and the limitations to the development in logistics as well. First, the paper presents a brief analysis of the historical development of the term and practice of logistics. Subsequently, a detailed analysis of the factors driving the development of logistics in urban areas is presented. This is immediately followed by a discussion on the impediments to logistics in urban centers and finally the paper details the implications that logistics present for urban settings.
Analysis of development in Logistics
In the past logistics was used as a military term to refer to the procedure to be followed in getting soldiers and ammunition to the battle front in time for a fight and for flight out of a danger zone. Since then its use has become part and parcel of modern business networks where it refers to the activities that facilitate trade.
During times of war prowess in logistics management has been essential in manipulating the supply chain of goods and services where animals such as donkeys and horses were used to ferry goods and people in a trade network. observes that a mastery of logistics has been the main contributor to the successes that have been achieved in some of the world’s major wars. For instance, the American’s defeat of the British in the American war of Independence and the defeat of the Axis in the African theatre of World War II can be attributed to logistical failures on the part of the losers. Further, he acknowledges that a military’s forte or an army’s strength lies in its capacity to maintain their supply lines while disrupting those of the enemy.
Similarly, with regard to business; logistics has in the past been associated with the management of the supply chain of goods and services. However, unlike in the war periods the management of the supply chain here is purely for profit making purposes. According to McGinnis (1992) the world’s increase in demand for consumption of goods and services has led to the development of professionals known as supply chain logisticians who are responsible for the management of the numerous networks of supply chains that facilitate trade and industry worldwide. The definition of business itself stems from the activities that revolve around logistical undertakings involved during business undertakings. The definition of business precisely acknowledges the need for ‘having the right item in the right quantity, at the right time, in the right place, in the right condition and for the intended customer.’ From this observation, it is apparent that business would not be what it is were it not for the logistical undertakings that surround it.
Today, the establishment, development and the maintenance of urban centers all over the world depend on the massive flow of commodities in an out of the urban centers. Moreover, the business transactions taking place in urban centers are reliant on the networks that facilitate the distribution of goods and services to and from urban centers. Hence, logisticians today have a twofold role to play in managing and sustaining the supply chain, first are the internal or inbound logistics management and secondly, in the outbound or external focus on logistics. These two functions prove key in the management of the supply chain. Logisticians combine professional knowledge from various functions such as inventory management, transportation, warehousing, purchasing, organization and planning to coordinate resources in an organization and ultimately in the supply chain at large.
Logistical Drivers
The factors contributing to the development of logistics are as much differentiated as the different supply chains in various financial systems across the globe. The foundations of logistics however stem from the desire by stakeholders to deliver goods and services to the customer at competitive prices meaning that they should deliver or receive goods at minimal costs in attempts to maximize on their profits. In addition, their logistical functions must tow line with the prevailing regulations and must also take into account the available transportation networks in ensuring that the goods or services reach the intended clientele in good time and in the right condition.
Much of the logistics facilitators in urban centers include; shippers (manufacturers, wholesalers, and retailers etc.), freight carriers (e.g. transporters and warehouse companies), residents (such as consumers) and Administrators (national, state and city level). All these players contribute in one way or another in urban dwellings logistics. These stakeholders whether working independently or in groups ensure that goods and services move from the source to the consumer and also ensure that information flows through easily as well.
Browne et al. (2010, p. 2) explains that logistics play a central role in servicing and retaining industrial and trading activities which are essential in wealth generation in urban centers. This is because road networks in urban dwellings help in the distribution of goods to numerous locations that are vital to urban life.
The varied destinations and starting points of the business networks dependent on city road transport networks include; suppliers, producers and consumers. Specifically, they incorporate hospitals, schools, public buildings; refuse collection, wholesalers, manufacturers etc. all who are reliant on the transport networks of urban dwellings to move their goods and services around.
According to logistics in the transportation networks of urban cities are essential in ensuring that city residents sustain their current existing lifestyles. Secondly, that logistics sustain industrial and trading activities that are essential in wealth generating activities. Thirdly, that it impacts greatly to the competitiveness of the industry in the region and hence has a direct bearing on the economy of the region. Lastly, they note that freight and logistics costs have a direct implication on the final prices of goods and services in the market.
Another factor driving the development of logistics in urban centers is the growing need for the flow of information about goods and services between producers, suppliers and consumers. Ultimately, the movement of goods and services as earlier mentioned also incorporates the management of information between the source and the receiver to ensure that the goods or services are delivered to the intended destination. This has pushed the legislation authorities in urban dwellings to set up a registry of the freight that is moved within city dwellings. This documentation is intended to give data that is likely to provide figurative projections of the amount and values of trade that takes place in the urban centers. Similarly, the same information can be used to regulate the movement of goods and services in and out of urban set ups.
The European Commission (2006, p. 3) observes that the use of information and communication technologies such as RFID vehicle routing software or load sharing systems results in major benefits that improve on efficiency in logistics associated with reduced travel distances. Future projections are such that better management and control of logistics in transport systems facilitate dynamic scheduling systems that are linked to real time traffic systems and roadwork information. This will help in saving time and resources that would otherwise be wasted where such information is lacking. In due course, information reduces costs of operation maintaining prices of goods and services at affordable levels.
Logistical Impediments
The major impediment to logistics in urban dwellings is perhaps its biggest driver; the population of the urban dwellings. Congestion in the urban centers has been the major contributor to the negative effects that logistics present in urban dwellings especially in freight delivery. This is because despite the milestones that the vehicle industry has achieved in developing environmentally friendly vehicles coupled by the development of infrastructure in modern cities; the greatest impediment still remains in the limited capacity of the cities given that they are congested by people which over stretches the capacity of the supply chain management stakeholders (logisticians). In the end these infrastructural and other achievements fall short of the requirements of an ever increasing population of the city residents.
With regard to data collection the major impediment to logistics is the incapability of the local authority to collect accurate data regarding the movement of freight in the urban set ups. The major difficulty associated with this is that collection of data is purely dependent on the availability of department for transport agents; secondly, the survey is based on vehicular activity which does not put into accurate account the physical location of the destination or source of freight. Thirdly, the surveys are limited in the differentiation of urban from rural freight since all freight regardless of destination or source is counted which results in the tallying of data that is not necessarily for the urban dwellings.
Closely related to information and data collection is the state of the communication networks between logistical stakeholders in city dwellings especially in the transport delivery systems. The system in place does not support real time information provisions for trucks and vehicles with goods on freight that would otherwise be useful in saving time and resources while goods are on transit. More importantly, the right information would ensure that operational costs are kept at a minimum ensuring that the prices of commodities in the market remain competitive. Nonetheless, the transport network in the UK is contemplating improvements in the adoption of communication and information technologies that are aimed at making the transportation of freight efficient and effective in future.
Lastly, postulate that an efficient logistical network depends greatly on an efficient transport network. They add that an efficient transport system in logistics activities may provide better logistics due to reduced operational costs and promote service quality. Therefore a congested road network that is characteristic of major urban dwellings with traffic snarl ups that translate in wastage of time and resources only serve to stifle the gains that can be realized from logistical undertakings.
Logistical Implications
The movement of goods and services in urban dwellings presents a major challenge in environmental pollution. Whereas stakeholders in the distribution chain such as administrators and consumers may share common view point’s regarding occurrences brought about by logistical activities for example; instances of accidents, congestion, noise and air pollution etc. freight carriers and shippers on the other hand share a common but different view point all together. Their focus is on delivering/receiving goods cheaply given the legal and infrastructural limitations thereof .
Consequently, due to the profit orientation or mind set of the shippers and freight carriers in urban centers, these areas are increasingly experiencing accidents, noise pollution, vibrations and air pollution that are brought about by Lorries, trucks, and other delivery vehicles. The effects of these disruptions caused by freighters have far reaching consequences on human life and on the damage of property such as roads and goods on transit. Thus, the movement of goods presents a challenge in urban centers that threatens the coexistence of logistical services alongside legislation that is meant to preserve the environment from pollution and physical destruction.
Conclusion
Generally, logistics is a term that refers to all activities that in one way or the other facilitate the movement of goods and services from the source to the consumer. Further, logistics also entail the movement of information that pertains the efficient and effective transportation of such goods or services. Essentially, the paper has discussed the main driving factors behind the development of logistics in urban centers. Centrally, the need for logistics in urban dwellings is informed by the growing demand for goods and services by the ever expanding population of urban residents. Notably, the greatest driver to the development of logistics in urban dwellings is also its greatest impediment since the growing population of urban centers is continually resulting in the congestion of urban centers and thereby overstretching the capacity of logistics in trying to meet the demand of the population. Fundamentally, the paper finds that logistics has far reaching implications to the economy of an urban center and an entire region given that logistics have a direct link to the final prices of commodities. Furthermore, the logistics have a direct bearing on the competitiveness of the economy of a region since it facilitates economic growth. Primarily, legislation that in any way influences the logistics of an urban dwelling must put into consideration the pros and cons of such laws to ensure the sustainability of economic growth in such urban set ups.
Bibliography
Anderson, S., Allen, J., & Browne, M. (2012). urban Logistics-how can it meet policy makers' sustainability objectives. Journal of Transport Geography , 13, 71-81.
Browne, M., Piotrowska, M., & Allen, J. (2007). Literature Review WM9: Part 1 - Urban Freight Transport. Wesstminister: University of Westminster.
European Commission. (2006). Urban Freight Transport and Logistics: An Overview of the European Research and Policy. . Belgium: European Communities.
Kampstra, R. P., & Ashayeri, J. (2006). Realities of Supply Chain Collaboration. The International Journal of Logistics Management .
konstantinopoulou, L. (2010). Trends of Urban Logistics in Europe 27. Strada Torino: City Log.
Mallik, S. (2010). CUstomer Service in Supply Chain Management (1ed ed., Vol. 2). Jersey: John Wiley & Sons.
McGinnis, M. A. (2010). Military Logistics: Insights for Business Logistics. International Journal of Physical Distribution and Logistics Management , 22.
Morriss, R. (2007). Colonisation, conquest, and the Supply of Food and Transport: The Reorganization of Logistics Management, 1780-1975. War in History , 14 (3), 310-324.
Tseng, Y.-y., Yue, W. L., & Taylor, M. A. (2007). The Role of Transportation in Logistics Chain. Proceedings of the Eastern Asia Society for Transportation studies , 5, 1657-1672.
