How Urban Consolidation Centres affect distribution networks: An empirical investigation from the perspective of suppliers

Abstract

An Urban Consolidation Centre (UCC) can decrease the number of freight vehicles and their mileage in urban areas. In practice, however, UCCs often rely on subsidies and seldom make it past their starting period. Understanding about how UCCs affect urban freight transport is mostly based on mathematical models and on the opinions of stakeholders who do not actually use a UCC. The purpose of this paper is to study empirically how the introduction of a UCC influences the logistics processes, costs, and service levels of suppliers. In a multiple case study, we collect data about the distribution networks of nine suppliers (including their receivers, carriers, and the UCC). Analyses of these data show that introducing a UCC affects the logistics processes of many actors in a distribution network, and these effects differ strongly depending on how the distribution network was structured initially. Generally, a UCC does not result in lower logistics costs for suppliers, at least not in the short-term, and often requires new service level agreements with receivers. We hope our study provides stakeholders with a balanced view on the role UCCs can play in making urban freight transport more sustainable.