Reconfiguration of supply chains and implications for transport

Essay by serifhsUniversity, Master'sA+, March 2006

download word file, 28 pages 3.7

Keywords Supply chain management, Distribution systems, Distribution operations,

Distribution management, Freight forwarding, Transport management


A large number of firms have reconfigured their supply chains. The general trends

entail, among others, the reduction, centralization and re-location of plants and distribution

centers, the design of new distribution systems, and the reduction of the supplier base. The analysis of the implications of such reconfiguration for freight transport has received comparatively little attention, and most of the analysis has focused on the development of different theoretical models showing how changes in logistic structures and decisions could affect the transport demand. Using empirical data from Denmark, this paper sheds some light on the implications of reconfiguration supply chains on transport. Industry mail surveys among Danish firms as well as an in-depth case study were performed. The consequences of the reconfiguration process on the present and future demand for transport are measured and analyzed in terms of the quantity of transport units used (trucks/containers), and the transport-work (ton/km).


A large number of international companies have reconfigured their supply chains

during the last decade. The most prominent drivers behind this trend have been: global

competition, increased focus on market requirements, advances in information and

communication technology (ICT), and development in international freight transport


Global competition has forced the companies to relocate their plants and

distribution centers in order to be both competitive and cost-efficient. In some

industries, e.g. the automotive and electronic industries, the focal company requires

that their key suppliers locate components production, sub-assembly plants or

inventory close to the focal company's assembly plants. In other cases, firms are

moving their manufacturing operations to low-cost countries in order to be more

cost-efficient. The German car industry has gradually moved to Poland, Hungary, the

Czech Republic, and South Africa. Similarly, most of the...