Institutional Issues in Urban Freight Consolidation

Abstract

The distribution of freight in most urban areas is characterised by high concentrations of truck activity in central business districts (CBD's). In this context, the movement of freight from suppliers, to resellers to ultimate customers is typically performed by a very large number of small carriers who duplicate each other's paths with partially filled trucks while each is in the process of picking up and delivering a large number of very small shipments. In many communities, this distribution structure results in unnecessarily high levels of congestion, pollution and energy consumption, as well as high distribution costs which are passed on to consumers in higher product costs. Several decades ago, business organisations responded to these pressures and initiated shippers' associations and freight forwarder operations to achieve the economies of consolidated shipments. Since 1942, however, the growth in the number of freight forwarders has been drastically curtailed.