Dr. Richard Hawkins

tTNO Strategy, Technology and Policy

E-commerce in the Logistics Sector

Study for the Dutch Ministry of Transport, Public Works and Water Management

Part of the Netherlands EBIP Contribution

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 2t

Questions:

• What are the value-added characteristics of transport and logistics products and services?

• What is the influence of electronic commerce on the value-added structure of the transport and logistics market?

• What are the consequences for public policy?

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 3t

Value-added characteristics

• Three hierarchical value chain tiers

Processing Transport Storage and/or Value-added logistics (VAL)

• PLUS two ‘vertical’ value chain tiers

Process management services Logistics solutions

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 4t

Generic value chain

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 5t

Case study value chains – COMPAQ (European Distribution Centre)

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 6t

Case study value chains – VOS

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 7t

Case study value chains – VAN GEND & LOOS

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 8t

Case study value chains – RYDER EUROPE

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 9t

Case study value chains – DHL NETHERLANDS

Logistics

solutions

Process Management

ORIGIN

Processing

Transport

Storage

and/or VAL

DESTINATION

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 10t

Influence of electronic commerce on the value-added structure

• E-commerce not a strategic tool

• User driven change

• Few revenue effects

• E-commerce causes process innovation

• Effects mainly in increased internal process efficiency – increased revenue retention

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 11t

• Client profits too

• Industry still cautious with e-commerce

• No effects yet on transparency of markets

• Shifts to higher value-added levels

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 12t

Consequences for public policy

• Possible market inequities and entry restrictions

• ‘Smart’ logistics firms may move off-shore

• Need to look at shift of lower value-added functions to logistics users

TNO-STB, 25 October 2001

E-commerce in the Logistics Sector 13t

E-commerce footprint in logistics

Electronic Commerce Innovations

Transactionpreparation

Transactioncompletion

Productionsupport

Pro

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vati

on

Pro

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vati

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Rel

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LOGISTICS