Putting the logic into logistics
Where should major logistics companies site their warehouses? Beside major ports or in regional or national distribution centres? Business analysts from the University of Southampton have been called on to examine the arguments.
Import Services’ new 20,000 pallet distribution centre opened in late 2011, right next to the city’s major container port. The company claims the new facility will cut costs and improve supply chain efficiency, largely because of its port-centric location. Yet suppliers have been slow to get the message. Import Services asked specialists from the Management School to research the business case for port-centric distribution and produce an independent report.
Dwij Ramloul, postgraduate student in Business Analytics and Management Sciences has examined the issues as part of his master’s degree. Working with both Import Services and its marketing and communications company Defero UK, he surveyed suppliers and retailers to discover their views about distribution systems. “I found supply chain logistics have become key for businesses, but many suppliers knew little of the port-centric model. I recommended the company take time to promote the benefits more widely,” says Dwij.
Senior Lecturer in Innovation, Dr Lorraine Warren, says: “Retailers know the benefits of port-centric distribution compared to traditional regional or national distribution centres. It saves time and money right along the supply chain. However suppliers are lagging behind in recognising this, our work may encourage them to think again.”
Managing Director of Import Services, John Eynon, addressed guests at the official opening of the warehouse: “As the first UK port of call for container ships plying from the Far East to Northern Europe, Southampton represents a logical route for the import of goods into the UK. We believe the port-centric model is more efficient than the traditional regional and national distribution centres for retailers. We therefore wanted to demonstrate this through the production of an independent research paper.”