A novel cost-management system for container terminals using a time-driven Activity-Based Costing approach

Abstract

Cost-management systems play a significant role in the operations management of container terminal companies; however, in complex loading and discharging operations, traditional Activity-Based Costing (ABC) systems are costly and difficult to be built and maintained. A modified Time-Driven ABC method, considering all the procedures required to obtain the final product and estimating resource usage accordingly, has emerged in response to this challenge. This study provides terminal operators with an effective cost analysis tool using a time-driven ABC method to identify bottleneck in handling process and calculate the handling cost of cost objects. Also, this research uses a container vessel and ten shipping lines calling at Shanghai East Container Terminal as case studies, and presents a full cost analysis of the activities and their respective costs. This investigation provides insights into the causes of excessive logistics costs and highlights the benefits of applying Time-Driven ABC method in the container terminal industry, along with shortcomings and potential future research.