Abstract
The improvement of logistics operation management for many tobacco companies highly depends on the reduction of distribution costs. In order to optimize routes, cigarettes are delivered through online real-time distribution system equipped with GIS/GPS. These network information technologies are crucial to creating and maintaining an efficient distribution system. Considering the applicability and flexibility of GIS/GPS network information system, this paper assesses the impact of its implementation on the logistics distribution cost from both overall and household levels. Specifically, DID and pseudo-DID models were adopted and monthly panel data of 14 prefecture-level branches of Hunan Tobacco Company during 2016-2019 were used for regression.We find that the implementation of GIS/GPS network information systems increased the total distribution cost. However, the average distribution cost was significantly reduced at per household level as the customer base expanded. A series of robustness and sensitivity tests supported above results. Furthermore, the implementation of GIS/GPS network information system is beneficial to service quality and employee performance. In addition, more time and logistics costs were saved when drivers chose “dynamic + fixed optimization” route model.
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