Demand Determinants for Urban Freight Consolidation Center - A Case of Korea

Abstract

Incorrect estimation of demand is one of the key reasons for failures of the urban freight consolidation center (UFCC) which is becoming more popular due to its ability to improve economic, environmental, and social sustainability of the urban freight logistics system. In order to help estimate the true potential demand for UFCC in Korea, this research identified transport company’s characteristics that indicate demand for UFCC. Freight transport companies’ operational characteristics and their demand response information were collected by survey and in-depth interview. The data were analyzed by rank order correlation and ordered logistic regression. All methods suggest that the estimation of demand for UFCC should be focused on those transport companies that generate large revenue but mainly use light (small and medium) capacity cargo vehicles. Other identified potential users are food and beverage transporters, transporters of distribution companies’ goods, container vehicles, and long contracted & self-owned vehicles. Those companies dealing with container and express parcel deliveries and making predominantly home deliveries could be also a good prospect for UFCC.