A decision support approach to designing the inland logistics network in China

Abstract

With the unprecedented growth of international trade, a growing number of multinational firms have coped with logistical challenges of shipping products to and from unfamiliar territories in many countries. These logistical challenges include the cross-border transportation of products originated from inland port to another inland port isolated from major waterways. In particular, the lack of access to major waterways would not only constrain the intermodal transportation option, but also make door-to-door, containerized delivery services nearly impossible. Such a limited option would eventually lead to increased transportation costs and transit time, and thereby offset low-cost global sourcing advantages. To aid multinational firms in addressing the problem of determining the optimal supply chain link between inland origin and destinations ports, this article proposes a shortest-path model based decision support system. The usefulness of the proposed model-based decision support system was validated by its application to a real problem encountered by a multinational firm that would like to strengthen its foothold in the Chinese market.