A Research of Performance of Logistics

System of Port of Shanghai and

Rotterdam
Man. Xu
328784
Superisor!
Mr.M "i#dam MSc
$rasmus %niersity Rotterdam
%r&an' Port and (ransport $conomics
)cto&er 2*++
Preface
As part of my study Urban, Port and Transport Economics at Erasmus University, I did a
research of performance of logistics system of Port of Rotterdam and Shanghai. I ould li!e
to ac!noledge several people for their contribution toards my study. "irst, I ant to than!
my parents, for sponsoring and supporting me during the years. Second, my supervisor, #r.
#. $i%dam for sharing his vast !noledge and for his guidance and comments during the
study. "inally, all my friends ho put high e&pectations on me, and hose continuous
encouragement has been a ma%or source of inspiration and confidence for the completion of
this or!.
Rotterdam, the $etherlands
'(, )ct *+''
2
A&stract
The main purpose of this thesis is to evaluate the current situation and potential of Port of
Shanghai and Rotterdam in terms of the performance of port logistics systems. Each ports
has their strengths and ea!nesses in the logistics system. As a result, this paper sho a
comparison of to ports that the performance of the port logistics systems is being evaluated
by different factors. These are infrastructure, logistics services, border procedures and time
and reliability of Supply ,hain. The study also emphasi-es the port.s important role in the
logistics development hich describing the changing role of the ports from traditional
transport hub to value/added logistics center.
0eyords1 Port, 2ogistics systems, Supply ,hain, Performance
3
List of (a&,es
Table ' . "rom "ordism to post/"ordism
Table *1 The classification of 2ogistics Performance
Table ( 1 Attributes of port logistics systems performance
Table 3 1 #easurements of to ports. centrality in 4#$
Table 51 Port charges of to ports
Table 61 ,omparison of production of to ports
Table 71 ,omparison of to ports clearance time and services
Table 81 The container ship turnaround time in to ports
List of -igures
"igure '. Evolution of import related logistics concepts
"igure *. Emergence of distribution related logistics concepts related to managerial focus
"igure (1 The location of container terminals of Shanghai Port
"igure 3. 2ocation of the distripar!s in the Port of Rotterdam
List of A&&reiations
TEU 1 Tenty/feet E9uivalent Units
"T: 1 "ree Trade :one
;RT 1 ;ross Registered Tonnage
$RT 1 $et Registered Tonnage
4
(a&,e of contents
Preface
A&stract
List of (a&,es
List of -igures
List of A&&reiations
(a&,e of contents
.hapter + / 0ntroduction
'.' <ac!ground
'.* Problem analysis
'.( #ethodology
.hapter 2 / Literature reie1 of port studies
*.' Introduction
*.* ,hanges in global maritime environment and liner shipping
*.( =evelopments in logistics concepts
"ordism to Post/"ordism
Three stages of the evolution of logistics concept
*.3 Trends in port sector
*.5 Standards of logistics performance
*.6 ,onclusions
.hapter 3 / Methodo,ogica, -rameor2
(.' Infrastructure
(.* Services
5
(.( )peration
(.3 Reliability of Supply ,hain
(.5 <usiness Environment
(.6 =ata collection
.hapter 4 / .ase Study
3.' )vervie of Port of Shanghai
3.* )vervie of Port of Rotterdam
3.( ,omparison of PoS and PoR logistics systems
.hapter 3 / .onc,usions and Remar2s
References
List of Appendices
6
.hapter + 0ntroduction
+.+ 4ac2ground
The ongoing development of global trade has significantly increased the demand of shipping
industries hich has e&perienced steady groth during the past fe decades. #ost of
developed countries or regions on seaports. Port as an very important sector of maritime
transport has e&isted for some thousand of years. It used to act as a simple transshipment hub
here freight passed beteen ships and landside transport as a result of its geographic
element and transshipment function.
According to Stopford >'??7@, a port is a geographical area here ships are brought alongside
land to load and discharge cargo/usually a sheltered deep ater area such as a bay of a river
mouth. <ased on different geographical characteristic, ports can be classified into hub, non/
hub, and feeder according to their function in the shipping system and their role in the region.
A hub port is a node here feeder shipping routes are connected ith each other and ith
inland transport modes routes for ocean/going voyages. In this case, port as a transshipment
place and gateay point that large/scale trade volumes are concentrated. Thus, port/related
activities agglomerate in the port to impact the regional or local economy. "eeder ports mean
that ports do not located on the overseas routes directly. They are only connected by coastal
or river vessels to the hub ports. 4hile non/hub ports are those in beteen hub and feeder
ports. They may have direct routes to overseas destinations and short sea lin!s, and they may
also have a small feeder lin!s ith feeder ports, but they lac! a strong port industry mi&
>Aames A, <rian *++3@.
<ase on the history research, ports position an very important role in transport sector as a
result of its lo costs and large/scale 9uality, port performances affected land
competitiveness directly by influencing business. concentration and national
governments.strategies. Thus, more and more ports are see!ing specific and competitive
advantages in order to be orld/class ports. In the first stage, the geographic advantage
playing the most important role in port function and operation in the history of port
development, port/related activities are increasing steadily. Then, some non/monetary
components in logistics perspective hich ould decrease transport costs, such as time,
reliability, safety, 9uality, ere proved to tend to represent a increasingly crucial role.
Especially the developed and advanced techni9ues ould gain the economies of scale from
7
the supply side. In this case, logistics strategies become increasingly important hich lead to
additional activities besides transport in port operations.
Robinson >*++*@ suggested that the role of ports and the ay in hich ports position
themselves must be defined ithin a paradigm of ports as elements in value/driven chain
system, not simply as places ith particular, if comple&, functions. And Panayides >*++6@
noted that the demand for maritime transport noadays cannot be solely considered to be a
derived demand emanating from the need for products, but rather as an integrated demand
arising from the need to minimise costs, improve reliability, add value, and a series of other
dimensions and characteristics pertaining to the transportation of goods from the point of
production to the point of consumption.
In addition, port plays an important fundamental role to develop the national economy.
Therefore the government enhances the investment in port infrastructure. And the Port
Authority have to rethin! and clarify the role of port ith the demand of logistics service
speciali-ation and globali-ation. The focus has become to ho to reduce the cost of port
construction and maintenance in ma&imum and hich high/efficient mode of port
management is going to be used.
This thesis is about the role of ports hich contribute into the development of logistics and
supply chains, a role hich can vary from that of simple transshipment hub to important
logistics node. It investigates the evolution process of logistics concept and the role of ports
in each stages. 2iterature revies is analysed in order to get an understanding of ho ports fit
for the development of logistics, and to significant ports are chosen in case study to discuss
the performance of logistics systems in each ports.
The focus of the thesis is on the Port of Rotterdam and Shanghai. Port of Rotterdam is vieed
as the most advanced port in the orld. Its business model in the port varies from only ater
ith a 9uay to a comple& one. The Port of Rotterdam has an e&tensive port and industrial
comple& model hich interconnected production and service providing activities. 4hile, Port
of Shanghai as an international shipping center is going to be or being the orld.s busiest
seaport. Those to ports differ not only in functions, but also administration and operation,
etc.
8
+.2 Pro&,em ana,ysis
There has been done some researches related to this sub%ect. These reports investigated the
role of port in global supply chains and the opportunities to attract ne economic activities in
logistics. The central arguments of this thesis is that ports have to reform its role ith the
evolution of logistics concepts.
,oming from the problem introduction above, it is possible to define the main ob%ective of
this thesis1
To e&amine traditional, current and emerging roles played by ports in the conte&t of
logistics and supply chain management. To dra lessons from the top port of each
region.
The main research 9uestion is derived from the ob%ective. The folloing research 9uestion
has been formulated for this research1
4hat is the role of Port of Rotterdam and Shanghai in each logistics industry, and
Bo is the performance of logistics systems in each portsC
4hich can be divided in the folloing sub/9uestions1
Bo does the seaports logistics developC
4hat is the ma%or trends of maritime logistics industryC
4hat is the ma%or trends of port developmentC
4hat are the components of the gateay port and hat factors are of influenceC
Bo does port classify in function, operation and administration perspectiveC
4hich level does Port of Shanghai and Rotterdam stay inC
=oes the Port of Shanghai be a orld/class port in the orldideC
9
+.3 Methodo,ogy
The main ob%ective of this thesis is to ma!e an analysis of Port of Shanghai and Rotterdam in
terms of the performance of logistics systems. This ob%ective specifically includes analysing
the Port of Shanghai in terms of port infrastructure, technology information, connecting
transport system and efficiency of operation of logistics. In order to come to a ell structured
analysis I used literature, articles, boo!s and the !noledge of the past years.
All the research 9uestions in this thesis are ansered by conducting a case study combined
ith an literature study. The literature study is used to identify and analysing trends and
developments in port and logistics. "urthermore, in the literature revie, a scarcity of
research concentrating on the evolution of the role of ports in line ith the changing of
logistics concepts. <eing e&ploratory in nature, this research aims to gain a comprehensive
picture of logistics concept research by as!ing 9uestions from different perspectives.
In order to generate detailed information, the case studies have been used to
compare two ports logistics s!stems" #oreover, the methodological framewor$
was introduced to anal!sis those factors to see$ing what would %ort of &hanghai
can learn from the case of 'otterdam"
()
.hapter 2 Literature reie1 of port studies
2.+ 0ntroduction
This chapter gives an overvie of the literature that has been published by different scholars
about the role of port positions in logistics and supply chain management. The purpose of this
literature revie is to provide a better understanding of hy and ho the changes in
international trade, transport and shipping affected logistics industry, and then ho port
management model changed ithin this changes. "irst, ma%or trends in the maritime transport
and liner shipping netor! are discussed to get a better understanding of ho global maritime
netor!s developed. Boffmann >'??8@ has ritten about changes in maritime logistics. Be
discussed about ho hub/spo!e netor! turns out. Also, $otteboom and 4in!elmans >*++'@
have ritten about these changes ithin the development of logistics and about ho the role
of port changes to face those challenges. Second, =e 2angen and van der 2ugt>*++5@ have
contributed to the e&isting literature about the role of port developed ith the evolution of
logistics concepts. They noted that the multinational function of ports ere diminished and
replaced by logistics activities ith a more regional function and stronger integrated ith
production activities.
2.2 .hanges in g,o&a, maritime enironment and ,iner shipping
;lobali-ation and transport revolutions has become a central issue for almost all segments of
industries at a global scale>"riedman,*++5@. The booming of global trade needs more
capacity in freight transport. And seaport is vieed the most important freight transport node
in contrast to other nodes, li!e airports and train stations. Thus, large si-e vessel has turned
out a very useful and profitable mode in global imDe&port trade. Boffmann >'??8@ has ritten
about to trends lead to concentration process in shipping industry1
"irst, the increasing of global trade as a proportion of orld ;=P made governments and
international organi-ations prefer to improving ports and shipping capacity and service
increasingly. This leads to larger optimum unit si-es of vessels, ports, and companies in port
industry.
Second, even though the fi&ed costs has increased as a result of construction of port facilities,
the change of technological has led to an decrease of variable costs as a proportion of total
average costs. And the transport costs is a biggest proportion of variable costs in any
((
industries. Thus, this increases the incentives for shipping companies see!ing for the
ma&imi-e capacity vessel in order to reduce unit costs >i.e., to achieve economies of scale@.
After dramatically increased of vessel si-e in recent years, faster and larger vessels, and
improvements in cargo handling at ports are significant trends. 2arger operators ould use
their economic of scale to get mar!et poer. In the meanhile, larger vessels means feer
port calls and more transshipment. This tendency directly leads to further concentration of
port traffic in feer and larger ports. Boever, there are only certain ports can handle such
ultra large vessels. Thus, there is groing traffic concentration at certain ports.
$ormally, more and more small/si-ed shipping lines and port terminal operators face the
threat hich they lac!ed of the mar!et poer in favour of the shipping lines and the added
capability of dealing ith huge amount of cargo. Increasingly, many mid/si-ed ports are
playing a feeder role to the very large ports as hub and spo!e netor!s have emerged
>Boffmann,'??8@. The development of the smaller ports is mainly dependent on the route
strategies of the ma%or shipping lines to attract increasingly call of shippers.
2arger shipping companies can get more profit by economic of scale to get mar!et poer.
Boever, this factor has diminished as a result of competition from international shipping
companies. #eanhile, the emergence of global production systems, in hich ra materials,
components, and final products are sourced, manufactured, distributed, and shipped globally,
has re9uired a profound restructuring of the transportation industry. Thus, the needing of
efficient logistics process to optimi-e transport chains, manage and integrate them ithin
seamless production, distribution and trading systems becomes the ne trends. Therefore, in
the ne&t section, I raise attention to the trends of logistics concept in maritime sector.
2.3 5ee,opments in ,ogistics concepts
"irst, the role of maritime logistics in maritime environment as defined. #aritime logistics
is concerned ith maritime transport >i.e. Shipping and ports@, traditional logistics functions
>e.g. Storage, arehousing, offering distribution centre services@ and integrated logistics
activities >e.g. Ealue/added services including labelling, assembly, repairing@ >$am, Song,
*+''@. #aritime logistics is often vieed as a process of planning, implementing and
managing the movement of goods and information ith ocean carriage being involved. In this
ay, ports have a great chance to play an important role as the center of global logistics
activities. Ports become a hubs have to meet and provide the global standard in terms of
(2
hardare and soft are by investing for orld /class infrastructures and by e&perimenting
ith several policies >U$ES,AP,*++5@. In this case, the role of ports mostly as the hubs
or! in the hole logistics process.
#any factors such as standardi-ation in production components, lo transportation cost and
the revolution of information and communication technology ma!e it possibale for global
companies to source ra materials and product components all over the orld and to bring
together and assemble ra materials, parts, and semi/finished products at a single or a fe
locations to reduce by a significant amount overall cost ithout any local interference to
product 9uality >U$,TA=,*++6@.
It can be concluded that efficient logistics process ould affect the performance of ports.
Thus, the function of those logistics process and liner shipping netor! highlights the role of
ports in maritime transportation. Bo does the changing of logistics affects the role of ports
ould be discussed in the ensuing paragraphs.
-ordism to Post/-ordism
has ritten about the impact of some structural changes in international trade in the sense
that logistics operation issue has to be changed in the frameor! of port management. The
most important change in economy is shift from "ordism to post/ "ordism. The "ordism
economy is based on the concept of F economies of scale F in production, hereas post/
"ordism is more directed toards F economies of scope F and fle&ible organi-ations through
co/operation in economic netor!s. Post/ "ordism is more focus on consumers. re9uirement,
hich associate ith product variet, the 9uality and the reliability of the consumer goods.
Together, the short product/life cycles and the short time/to/mar!et affect the logistic chains
leading to more adoptable multi/firm organi-ation structures for most production companies.
Table ' . "rom "ordism to post/"ordism
"ordism Post/ "ordism
Source of
competitiveness
Economies of scale based on
basic production factors
>capital, land, labour@
Economies of scope based on
advanced production factors
>!no/ho, procedures@
$ature of products Standard products 2arge product variety
(3
E&tended life/cycle
2o lead/time
Short life/cycle
Short time/to/mar!et
Environment Stable, limited insecurity and
ris!
E&isting mar!ets and products
=ynamic, high insecurity and
ris!
$e mar!ets and products
)rgani-ation Integrated firm
Standard procedures and
process
In/house production >Fma!eF@
"le&ible multi/firm netor!s
Incident management
)utsourcing >FbuyF@

In the above paragraphs, the changing of logistics are discussed. )utsourcing of logistic
functions is vieed to be an important strategic option as a result of surpassing the capability.
In the post/"ordian era, there are three basic forms of outsourcing can be distinguished ith
regard to supply chain management1 >$otteboom and in!elmans, *++'@
The outsourcing of the production of components. Increasingly large production units in
favour of the global cooperation hich organi-ed on a global or local scale. The demands
of the mar!et has resulted in manufacturers increasingly entrusting the logistics to third/
party logistics providers >(P2s@. Therefore, outsourcing logistics has alloed the
manufacturers to focus on their core business activities to benefit from the economies of
scale of their (P2 partners and the broad range of services offered by speciali-ed
logistics services providers >U$,TA=, *++6@.
Ealue/added logistics >EA2@. =ue to the booming global trade and technology
development, the significant changing is concentration and internationali-ation of
logistics service providers. In this case, customers prefer to loo! for overall logistics
service providers, such as shipping lines, forarders and terminal operators. Thus,
logistics providers search for attracting more sophisticated value added activities, hile
others lac! the re9uired scale and capabilities >=e 2angen and van der 2ugt, *++5@.
Ealue/added logistics is an emergency concept in logistics industry noadays . It ould
be discussed in the latter section to e&plain hy value/added logistics changes the role of
ports in line ith the development of logistics.
(4
The outsourcing of transportation, arehousing and distribution. $ot only outsourcing of
transportation is already idespread, but also arehousing and distribution activities are
becoming fast groing outsourcing businesses. #any companies have ac!noledged
that arehousing and distribution is not part of their core business and as a result these
operations are outsourced to logistics service providers >$otteboom, 4in!elmans, *++3@.
(hree stages of the eo,ution of ,ogistics concept
To get a better understand about ho the evolution of logistics concept impact the role of
ports changing, =e 2angen and van der 2ugt classified ( stages that have evolved in Europe
first 1
Internationalisation products are delivered directly to different mar!ets in Europe. In this
stage, transport is decentralised, different countries in Europe ere different mar!ets.
The national distribution centres ere contributed into different consumer mar!ets.
The second stage is the concept of integration ,entral European =istribution hich a
single physical central distribution location here value added activities can ta!e place is
to get more efficient logistics. Such a single distribution center serves all European
mar!ets. In this case, the port here this certain single distribution centre as located
can be defined as a gateay port.
Gateway port - Ports serve as a critical link between geographical areas or regions by
providing a system of road, rail and marineas transportation infrastructure of national
significance for international trade as a node in a globalized supply chain(Jose, 2!"#
$trategic location, efficiency and reliability, connectivity and shipping fre%uency and
ade%uate infrastructure are the key determinants of gateway ports#
Strategic location1 situated on the main maritime routesG situated in or near
production andD or consumption centersG ith natural deep ater harbors, natural
brea!ater and big aterfront and landside development
possibilities>U$,TA=,'??*@. The to top ran!ed ports, Bong 0ong and Singapore
as very good e&amples, have been chosen by ma%or container lines as interchange
points beteen main line and feeder services.
(5
Efficiency1 speed and reliability of port services. ,ompetitiveness as the ability to
get customers to choose a particular service over competing alternatives on a
sustainable basis >Schlie,'??6@.
Ade9uate Infrastructure1 include physical and soft elements. Physical infrastructure
includes not only the operational facilities, but also the inter/modal transport. The
soft infrastructure refers to the manpoer employed. 4orth to noted that information
technology is applied increasingly in logistics.
,onnectivity1 fle&ibility netor!s around transshipment ports here different trade
routes intersect and interconnect have replaced traditional port/to/port routes. And
great fre9uency of ship calls allos for greater fle&ibility and loer transit time.
&ikewise, high performance distribution systems will be re%uired# 'hus, an ideal gateway
port should provide a diverse range of services that are highly integrated# 'he role of
gateway ports is definitely played when logistics is taken into account#
,entral coordination logistics platform. This concept focus on the combination of
logistics efficiency and mar!et e&pansion hich as driven by customer re9uirements.
(6
"igure '. Evolution of import related logistics concepts
$ource( )nternational Journal of &ogistics
In the ne&t section the development of ports are discussed. As ma%or gateays for maritime
trade, many ports are ta!ing advantage of their strategic position in the logistics chain by
offering numerous additional value/added services >Alderton,'???@.
2.4 (rends in port sector
Ports and maritime transport have e&isted for some thousands of years and have developed in
line ith the evolution of international trade hich has been inherent in shaping the modern
orld. Ports and maritime transport thus play an important role today in global commerce. It
is important to first define e&actly hat is meant by the term HportH.
5efinitions
Port is a geographical area here ships are brought alongside land to load and
discharge cargo/usually a sheltered deep ater area such as a bay of river mouth.
(7
>Stopford,'??7@
Traditionally, ports ith high volumes of local cargo can be a transshipment centre. Boever,
some small ports no local cargo at all. Thus, this led to ne trend that many big ports has
generated additional business by attracting the cargo from other small ports. The
concentration also happened in the port sector. As I discussed that concentration can lead to
loer unit costs through scale economies. To be attractive as a transshipment centre, a port
need to have a local cargo base or at least to be located near another port hich has its on
cargo base >Boffmann, '??8@.
Also, $otteboom >*++3@ noted that shipping lines try to attract cargo by differentiating from
competitors through calling in different ports. This change as merely to develop terminal
capacityG it can save relatively high transport costs over land. <ut, due to the huge increase of
cargo volumes, the competition among those transshipment ports also increased. To gain cost/
minimise is alays the main goal during the logistics process. Thus, #ore and more ports
ere searching for a more comple& liner shipping netor! >multiport@ to attract direct calls of
large vessels.
As I discussed above, globali-ation has created a real/time global mar!etplace and a business
focus and concentration on ma&imi-ing comparative advantage. #any factors such as
standardi-ation in production components, lo transportation cost and the revolution of
information and communication technology ma!e the concept of F;lobali-ationF more
possible. Ra materials, parts and semi/finished products can be brought together as a single
or a fe locations >U$,TA=,*++6@. Thus, many companies have generated e&isting logistics
places into a fe integrated logistics centers. In this case, ports have played an important role
as the center of global logistics activities. "or instance, Reebo! has selected the Port of
Rotterdam as its logistics center is a good e&ample. The logistics center concept ould be
discussed in the ne&t section.
The !ey factors for transshipment center ports are strategic location, high level of operational
efficiency, high port connectivity, ade9uate infrastructure, ade9uate info/structure and a ide
range of port services >Tong-on, *++'@.
(8
As a result of value/added logistics, the function of ports also have to be redefined. Robinson
>*++*@ notes that the role of ports and the ay in hich ports position themselves must be
defined ithin a paradigm of ports as elements in value/driven chain systems, not simply as
places ith particular, if comple&, functions. Thus, the role of port has to be redefined to fully
fulfill the evolution of logistics. =e 2angen and van der 2ugt>*++5@ thought that the role of
ports in global supply chains varied and had opportunities to attract ne economic activities
in logistics.
After the reflecting by logistics trends, Panayides>*++6@ noted that the demand for maritime
transport noadays cannot be solely considered to be a derived demand emanating from the
need for products, but rather as an integrated demand emanating from the need to minimi-e
costs, improve reliability, add value, and a series of other dimensions and characteristics
pertaining to the transportation of goods from the point of production to the point of
consumption. Be has contributed that the changing role of ports in logistics and supply chain
management can vary from transshipment hub to logistics node, and hich in turn is heavily
dependent upon the supply chain strategies of those ho use these ports. =e 2angen>*++3@
had concluded that ports are not only as a location for logistics activities, but also clusters of
economic activity.
Also, $otteboom >*+++@ defined a port by using cluster effect concept1
A seaport is a logistic and industrial centre of outspo!enly maritime nature that plays
an active role in the global transport system and that is characterised by a spatial and
functional clustering of activities that are directly and indirectly involved in
HseamlessH transportation and information processes in production chains .
>$otteboom,*+++@
4hile, logistics management has ea!en after firms realising that Supply ,hain #anagement
is a ay to get competitive advantages >Panayides,*++3, $ova! et al, '??3@. Supply chain
management started fulfilling the re9uirements of customer and focusing on the alignment of
all activities to create competitive advantage for serving these customers. Thus, ports as an
important part in logistics concept should arrange different supply chain management model
ith varing conditions.
It is very important to !no the logistics management is differs from the supply chain
management, thus =e 2angen and van der 2ugt defined logistics management is a part of
(9
supply chain management and is significantly influenced by changes in supply chain
strategies.
"igure * . Emergence of distribution related logistics concepts related to managerial focus
$ource( )nternational Journal of &ogistics
Therefore, the needing of reform and rethin! concerning the onership and management of
the ports sector associated ith varing Supply ,hain #anagement #odel. <roo!s and
,ullinane >*++7@ noted that many governments have moved to e&tract themselves from the
business of port operations and have concentrated on monitoring and oversight
responsibilities. <aird >'??5@ put forard four models of port administration for the various
aspects of ports activities. Also, the classification of ports capture all relevant aspects of the
relation beteen the mar!et and the government >Stevens, '??7@.
:hang, Iiao >*+'+@ has discussed about different Supply ,hain models in the sense that port
logistics development model is a !ey issue related to the port function location and the core
competitiveness. Be concluded that the operating mechanism of the modern port needs to
advance ith the times to see! the on logistics model according to local conditions. Each
model has its on characteristics in the physical environment, hardare, management and
government support.
2)
4ith the development of ports, the core of port management concept has e&perienced a
process that is from the cost idea to the profit idea then to the integrated logistics service
concept >efficiency idea@ >:hang, Iiao*+'+@. Thus, he concluded that the needs of ports to
select a model suited to their development associated ith local conditions, the on
conditions and characteristics of each model to ma!e matching.
2.3 Standards of ,ogistics performance
4ood et al.>'??5@ described three categories of standards of logistics performance in terms of
nations1 the first orld, the emerging economies, and the third orld. The $etherlands is stay
in the "irst orld, and ,hina is in the emerging economies level. Be had used some factors to
measure a nation.s logistics performance hich includes infrastructure, performance,
information system and human resources, etc. Be noted that all of the logistics infrastructures
can be said to be highly evolved, certain differences remain due to historical development and
geography in the "irst orld. The detailed classification of logistics performance as
summari-ed by Simchi/2evi et at. >*+++@.
Table *1 The classification of 2ogistics Performance
"irst 4orld Emerging Third 4orld
Infrastructure Bighly developed Under/development Insufficient to
support advanced
logistics
Supplier operating
standards
Bigh Eariable Typically not
considered
Information system
availability
;enerally available Support system not
generally available
$ot available
Buman resources Available Available ith some
searching
)ften difficult to find
2..6 .onc,usion
The development of ports is very much lin!ed to the development of the economy. This
relation can be e&plained in to ays. The first e&planation is because port is vieed as a
main economic driver ill gain enormous capital hich contributes into national economy.
2(
The second e&planation is because nation.s economy or region.s economy is developing
rapidly and it ill invest in its transport and maritime transport facilities to improve its ports
development.
;enerally, most ports acted as simple transshipment hubs here freight passed beteen ships
and landside transport. <ut more and more ports ere further orsening as a result of losing
their geographic comparative advantages after technological developments. Thus many
original port areas face the challenge increasingly and need ne strategy. #oreover, ports are
alays seen as engines to affect the regional or national economic development.
This chapter focuses on the role of ports in global logistics chains and the opportunities to
attract ne economic activities in logistics. The function of ports has been changed from
traditional transshipment in order to transfer goods to an important role in the management
and coordination of materials and information, as the transport is a integral part of the entire
supply chain >,hen. ,, *++'@.
In addition, each ports has stayed in different levels in terms of performance of logistics
systems. In the ne&t sections, methodological frameor! and case study ould be used to
e&amine the performance of logistics systems in Rotterdam and Shanghai.
22
.hapter 3 Methodo,ogica, -rame1or2
As the important logistics nodes, the level of the logistics service is the core competitiveness
of ports. In order to generate detailed information, the attributes of a orld/class logistics
system are used to compare to ports logistics systems. Then, the compositive method of
attributes is proposed to categories logistics systems in to ports. According to 4ood et al.
>'??5@ and 2PI >logistics performance inde&@, the four general attributes, i.e. infrastructure,
performance of logistics services, border procedures and time, and supply chain reliability are
employed.
The purpose of case study is to conclude the performance of the logistics systems in to
ports. Port of Shanghai and Rotterdam represent top port of Asia and Europe respectively.
Those to countries are studied in detail to dra logistics lessons applicable elsehere.
Therefore, the focus is evaluating ho efficient the operation of logistics in to ports. Thus,
in this section a methodological frameor! ill be outlined first.
3.+ 0nfrastructure
The !ey role of an integrated logistics system is to assist in the production, consumption and
distribution, hich means that goods must be produced and delivered to the mar!et in the
right 9uantity, re9uired 9uality, and at a competitive price>,hristopher, #., '??8@. Thus, I
ould use 3 main factors to e&plain the importance of 9uality of infrastructures in port
logistics systems.
The infrastructure of ports are an essential component of modern port logistics systems.
There are to ays of measuring port infrastructure 9uality1 physical indicators and
economic or financial indicators.
"irst, physical indicators generally refer to maritime infrastructure hich consists of port
facilities and maritime transportation netor!s.
#aritime transportation netor!s can be considered a pro&y of the port.s accessibility to
global ports. And the maritime transportation connectivity can be measured by degree and
beteeness of to ports. centrality in the 4orldide #aritime Transportation $etor!
>4#$@. J. Bu and =. :hu>*++8@ has noted that a typical hub/and/spo!e structure consists of
interconnected hubs and other nodes hich allocated to a single hub. This structure allos the
carriers to consolidate the cargo in larger vessels to loer the transportation cost. Thus, the
23
more connection the interconnected hubs>central nodes@ ith other nodes ould reduce
transportation cost.
#oreover, port facilities consists of hardare and softare. Bardare infrastructure includes
land hich is referred logistics activities and e&it of cargoes. Softare infrastructure refers to
port operating systems. "or instance, the port dues and cargo/handling charges. <oth facilities
can fairly determine the strategy of port development.
Second, it is important that the movement of goods can be made by combining several modes
of transport from ports to a destination. Thus, economic and financial indicators are usually
related to the hinterland accessibility >road, rail, etc.@. 2and/side efficiency is related into the
the e&pansion of port capacity by ne transport infrastructures >0halid and Richard, *++3@.
And hat is more, information platform and logistics technology ould promote rapid
development of logistics industry. Thus, I set the 9uality of I,T infrastructure as an indicator
also. #ore stable and innovative I,T system represent more advanced logistics system. Also,
I set more specific indicators hich comprises several third/level indicators in the table.
Additionally, the length and production of berth are used to measure the 9uality of port
infrastructure. #oreover, more capacity of arehouse ould provide more capacity for
cargos to stay.
3.2 Serices
"rom the port logistics services, e can see the current operation performance and
sustainable development of port logistics industry. So it is easy to !no the strength and
ea!ness of port logistics industry. The mainly indicators refer to domestic logistics costs
and the si-e of port logistics. 2oer logistics cost is alays the ob%ective of logistics
services. As I discussed above, the maritime sector has lo transaction costs and large
economic of scale hich locate the most important status in transport sector. Thus, the 9uality
and efficiency of port logistics industry are mainly determined by domestic logistics costs
and the si-e of port logistics.
"or domestic logistics cost, the timely and costs delivery of shipments to destination are used
to indicate this factor. Shorter time and loer costs means lo logistics costs and efficient
logistics performance. Also, other infrastructure charges of ports are used to compare the
domestic logistics costs of to ports. "or the si-e of port logistics, the handling capacity of
port logistics refers to the 9uantity of goods hich load and unload in the port. That is the
24
reason that ports e&pand the investment of port infrastructures to get more capacity of port
logistics. Thus, throughput hich is divided into cargo throughput and container throughput
is used to measure the si-e of port logistics services.
Port charges are caculated by the sum of various tariffs hich are based on ;RT, $RT,
length, draft and etc. In order to compare to ports. charges, harbour and light duesG
pilotageG toageG mooringDunmooring and ancillary charges are used. Barbour and 2ight
=ues are using charges according to the tonnages of vessels. Pilotage charge is the service fee
hich is calculated by the si-e of a vessel andDor the distance. Ancillary charges consists of
portlclearance chareG port entry feeG maritime elfare chares and harbour cleaning and
maintenance fee, etc.
3.3 )peration process
)perational indicators are more direct concern to port management than financial indicators.
The important information to concern is the number of ship arrivals and a brea!don of the
ships. time in port for each class of cargo. ;enerally, it can be indicated by turn/round time
and degree of congestion. The turn/round of ships in ports direct concern to ship oners and
operators, and then concern to shippers and consignees ho must pay the freight rate
>Plumlee,'?75@. $ormally, turn/round time is total time beteen arrival and departure for all
ships hich divided by number of ships. 4hat is more, the congestion level is also an
e&cellent indicator to maintain of port effectiveness. The congestion of ports means longer
aiting time
'
for berthing spaces in the port. The figure must be higher hen congestion e&ist
than ports ithout congestion.
Any reduction in turn/round and aiting time ould therefore reduce the overall cost of the
delivered goods >Tyorth and :eng, '??8@. Thus, for a efficient port, 9uic! vessel turnaround
time and high berth production are very important factors. The longer a vessel stays at the
berth, the more the port charegs for the vessel.s stay.
According to the development of S,#, the process of operation of port is a !ey prere9uisite
to improving the efficiency of port logistics. <ased on the investment of capacity of container
terminal, the container ship turnaround time at port ould be a core factors to decide the
efficiency of a port. #oreover, import and e&port time is a useful measurement of logistics
performance.
(
*aiting time+ total time between arrival and berthing for all berthing ships, divided b! number of
berthing ships"
25
3.4 Supp,y chain re,ia&i,ity
Time and costs are not the only dimensions in hich reliability is also important. The
reliability of the supply chain is the most important indicator of logistics performance.
$ormally, the reliability is evaluated by the 9uality of logistics service hich is mainly
measured by import and e&port time directly. $otithstanding, most customers mainly
consider hether cargos delivery ithin the promised time and hether errors e&it, the speed
and route are not the only factors that can affect importDe&port lead times >2PI,*+'+@. The
border process
*
has a big possibility to influence the hole logistics process. Thus, delay in
actual delivery hich can be caused by the unpredictability of the clearance process itself
may be more important than average importDe&port lead time in understanding logistics
performances. #ore over, clearance time and transparency of customs clearance are used to
measure the efficiency of customs clearance process>2PI, *+'+@. Thus, delays in logistics
process, hich is caused by custom clearance services is the main indicator to measure the
reliability of the port management in S,# instead of the average importDe&port lead time.
3.3 4usiness enironment
This attribute give a brief overvie of the opportunity to invest in the ports. <usiness
environment ould be influenced by changes of internal and e&ternal environments. ;ood
environment means challenges for the neighboring port development. The most attractive
factor is indicated by the foreign investment in port infrastructure.
Table ( 1 Attributes of port logistics systems performance
;eneral
attributes
Specific attributes Indicators
Infrastructure #aritime transport #aritime accessibility
Port infrastructure Port infrastructure
Transport infrastructure Road accessibility
Rail accessibility
I,T infrastructure Telecommunications and IT systems
Services =omestic logistics costs Port charges
,ost to import a 3+/foot container or a
2
,order process+ time to clear goods as opposed to lead time"
26
semi/trailer
,ost to e&port a 3+/foot container or a
semi/trailer
The si-e of port logistics ,argo throughput >'+++/ton@
,ontainer throughput >'+++/ton@
)peration Time and ,ost #easured by the container ship
turnaround time of ports
,ongestion level
Supply chain
reliability
Efficiency of the clearance
process
,learance time >days@ ith physical
inspection
,learance time >days@ ithout physical
inspection
Transparency of customs clearance
<usiness
environment
Investment "oreign investment
In the ne&t section, an analysis ill be used to compare to ports logistics systemsK
performance. "irst, overvies of to ports are used to give a brief introduction and then more
specifically comparison of to port logistics systems is discussed.
3.6 5ata co,,ection
This article ishes to evolute port performance by several attributes. <ecause this study does
not ish to describe in detail of to ports, it proposes aggregating the data in such attributes
to compare to ports. logistics performance. Such an approach is better related to actually
data. 4hile, it is hard to find more specific data about to ports logistics in some indicators.
Thus, I decide to use the closest data hich I could find to evaluate to ports logistics
performance.
27
.hapter 4 .ase Study
4.+ )erie1 of PoS
The Port of Shanghai is located in the vicinity of Shanghai hich comprises a deep/sea port
and a river port. Port of Shanghai has been the largest and most important seaport in ,hina
since the end of the nineteenth century. The Port of Shanghai.s contributions to the economy
of the nation came at a high price for the city. Shanghai is no establishing a presence as an
international shipping and financial centre. Also, Port of Shanghai has been shoing its
interests in the logistics industry to improving national e&port competitiveness through a
sophisticated domestic logistics industry and attracting foreign companies.
"igure (1 The location of container terminals of Shanghai Port
$ource( Port of $hanghai
28
0nfrastructure
*istribution network
Port of Shanghai consists of three ma%or container port areas, namely 4usong!ou,
4aigao9iao and Jangshan deepater Port in the port area. It operates a total of *?( thousand
s9uare meters of arehouses and over 3.7 million s9uare meters of storage yards. 4usong!ou
Port as the main port prior is used for domestic container vessels G and Jangshan =eep/ater
Port as a man/made area ill increase to '8 s9uare !ilometers and the deepater coastal line
ill reach ** !ilometers by *+*+. #ore than 5+ container berths, capable of handling the fifth
and the si&th generation of container ships >5,+++/6,+++ TEU@ ill be built. The annual
handling capacity of the deepater port ill increase to around *5 million TEU.
Although the Jangshan Port could not compete ith Bong 0ongKs natural and deep/ater
harbor, Bong 0ong lost its traditionally manufacturing centre position since the establishment
of the Shen-hen Special Economic :one in '?7?. Therefore, the opening of Jangsan
,ontainer Terminal is e&pected to lead to a reduction in the number of direct calls by ma%or
services at other ports of mainland ,hina, contributing to the increased transshipment
opportunity at Shanghai
(
.
The Port of Shanghai also ons 5'3( units of cargo/handling e9uipment
3
. The port connects
the east/est traffic route, i.e., the Jangt-e River, and the north/south traffic route, i.e., the
sea coast
5
. Shanghai port has '6 international shipping lines connecting ith 5++ foreign
ports in more than *++ countries.
+ater transportation
=onghai <ridge is standing in the northern part of Bang-hou <ay and lin!ing the deep/ater
port ith the mainland. The length of this bridge is ('.( !ilometres and ('.5 meters ide,
ith si& highay lanes. The annual navigable capacity under the bridge ill be over 5 million
TEU.
Jangshan deep/ater port as a industrial -one is '+3 !ilometres distinct from international
shipping routes. The depth of sea is '5.' meters that the fifth and si&th generation container
3
&ource+ -./&01%, 2))5
4
&ource+ *orld port source
5
&ource+ 1sia trade hub
29
ships can be loaded in port ith all/eather. It ould raise the status of Shanghai hub to
speed up the building of an international shipping hub. The Jangshan deep/ater port has
more than (+ terminals ith an annual handling capacity of '5 million TEUs and above.
,oad
The highay netor! hich consist of To Avenue of PortG Bong!ong/Shanghai 2o Speed
>A*@G the )uter Ring of Shanghai >A*+@ and Suburban Ring >A(+@, ould ma!e the traffic
more poerful and efficient.
,ail
The construction of a ''7!m Pudong railay is e&pected to help Shanghai develop into a
shipping and aviation hub in Asia. The railay lin!s suburbans such as Ainshan and Pudong.
The railay ill mainly transport cargoes fromDto Pudong International Airport, Jangshan
=eep 4ater Port district, 4aigao9iao "T:, and ,ao%ing ,hemical Industry Par!.
-aintenance and development
As shocased in Shanghai #unicipal ;overnments.s ''
th
"ive/Jear Plan >*++6/*+'+@,
appro&imately '7 billion R#< >*.+6 billion US=@ credit invest for the port construction up to
the year *+*+ >port of shanghai@. The construction of 5 7 to '+ thousand/ton berths able to
accommodate the orld.s most ne&t generation on Post/Panama& container shipsG 9uay
length ould be '6++ mG an area of '.5( s9uare !ilometers land area ith an annual handling
capacity of ( million TEUs or more.
The development of Shanghai e/port system is to improve the economic effectiveness and
social benefits of local international logistics informationi-ation hich based on the
electronic customs declaration and the electronic payment platform.
4.2 )erie1 of Port of Rotterdam
The Port of Rotterdam is the largest port in Europe, located in the city of Rotterdam, South
Bolland, the $etherlands. It became one of the first global ports, a tradition that still
dominates today as Rotterdam is the maritime gateay to continental estern Europe. 4ith
the groth of industrial activity in its hinterland, especially in the Ruhr >;ermany@ in the
$ineteenth ,entury, bul! transshipment facilities ere added in the '?*+s and folloed by
petrochemical facilities in the '?(+s. The port became one of Europe.s main oil
3)
transshipment and processing facility hich contributed into the orld.s largest
petrochemical comple&.
Port of Rotterdam has about 5++ connections to more than ',+++ ports orldide. The port
no has more than *++ hectares of sites ready for distribution over numerous plots. In order
to use the available space to cope ith the groing throughput, storage and distribution of
containers for industry.as efficiently as possible,
Port of Rotterdam as European centre for transshipment, industry, distribution, trade and
transport, centrali-ation brings it many logistical and other advantages hich include
reduction of logistics costs, increased sales, improved control, better product availability,
enhanced competitive position, faster mar!et response, etc.
0nfrastructure
*istribution infrastructure
The Port of Rotterdam covers an area of over 5.( thousand hectares of infrastructure and
ater surface. The port is 3+ !ilometers long and contains 8? !ilometers of 9uays and '5++
!ilometers of pipelines. The Port of Rotterdam has over ?+ terminals speciali-ing in different
types of cargoes
6
. The container terminals situated directly on the $orth Sea have a depth of
up to '?.65 metres at the edge. The port ill be e&tended by #aasvla!te * ith *+L.
Rotterdam has three large/scale areas for distribution centers spread throughout its port1
=istripar! Eemhaven, =istripar! <otle! and =istripar! #aasvla!te. All are strategically
located close to ma%or container terminals and the city.s many transport lin!s to the European
mar!et. =istripar! Eemhaven mainly accommodate third party logistics service providers and
provides specialised storage and distribution area for companies, the distripar! at the
#aasvla!te is an area for centralised distribution of dedicated logistics companies. The
<otle! support location for logistics service providers that are used to storage of especially
chemicals. It is orth to !no that #aasvla!te often as the orld.s ma%or container.s first
call in Europe. Truc!s can bring and pic! their containers, barges provide the connecting
transport to and from container terminals on the #aasvla!te. )n the #aasvla!te, it is divided
into standard (.3/hectare plots hich is big enough to accommodate a arehouse covering
*+,+++ s9uare meters plus offices and all ancillary facilities. After the construction of
6
&ource+ %ort of 'otterdam
3(
#aasvla!te *, in total the port area ill increase by *+L. #aasvla!te * ill cover *,+++
hectares, of hich ',ooo hectares ill be lettable sites.
"igure 31 2ocation of the distripar!s in the Port of Rotterdam
$ource( Port of ,otterdam
)nland shipping
Rotterdam is located strategically at the mouth of the rivers Rhine and #aas to attract more
reliable and cost/effective containers beteen the port and a comple& netor! of inland
terminals in the $etherlands, <elgium, ;ermany and Sit-erland. Today, inland barges carry
around ?++,+++ ,TR to and from the hinterland.
,oad
A'5 as the primary motoray to the Port of Rotterdam offers optimum accessibility to truc!s
hich around 8+ million tons transported by truc!s. Truc!s leaving Rotterdam in the
afternoon are in #unich, "ran!furt, ,ologne or 2ondon the ne&t morning.
,ail
Port is the start and end of the <etueroute, the '6+/!ilometre dedicdated freight railay
beteen Rotterdam and ;ermany hich ensures a good rail lin! to the ;erman hinterland.
Also 5+ short/trac! rail shuttle services are provided. And HBigh fre9uency rail transport
programmeH enables high fre9uency rail transport on highly utilised rail routes in the
Randstad. The connection of the port to three locations in the ;erman netor!1 )lden-aal,
:evenaar and Eenlo, ill provide a reliable accessibility to the ;erman hinterland.
).'
32
The seaport cluster of Rotterdam has already been affected fundamentally by technological
changes1 I,T has led to everyone no using mobile phones and computers, and much
physical or! on ships and ports has been automated. Rapid technological development is
li!ely to continue during the coming years ith ne forms of I,T implying pervasive
computing, radio/fre9uency indentification >R"I=@, nanotechnologies and other innovations.
Also, integrated E=I technology lin!s shippers and consumers effectively. R"I= technology
ma!es it possible to place small electronic tags on various goods, machines and other
products, and thereby trac!ing them.
-aintenance and development
Rotterdam #ainport =evelopment Pro%ect >P#R@ ould strength the mainport and to
improve the 9uality of the living and or!ing environment by three pro%ects1 ',+++ hectare
e&tension of the port into the sea, and ill be *+ meters deep and able to accommodate larger
container ships than any other port in Europe
7
G e&pansion of the e&isting port and industrial
area to facilitate more intensive use of the space and to improve the 9uality of the living and
or!ing environmentG the construction of 75+ hectares of ne recreational and natural areas
near Rotterdam. #ore specifical pro%ects are introduced belo1
Binterland connection1 the <etueroute ill be used to have an effective north/south branch
at ;eldermalsen.
Rail1 the Rotterdam/<elgium rail lin! ill be developed further and connected to the
<etueroute.
Inland ateray1 the <reeddiep pro%ect can help inland ateray vessels to access the
e&isting #aasvla!te and #aasvla!te * more efficient.
Road1 the construction of the A3 $orth, the second <otle! Tunnel and the capacity
e&pansion of the A'5 ill be completed by *+'5.
In *+*+, the Rotterdam/<elgium rail lin! ill be developed further and connected to the
<etueroute.
4.3 .omparison of PoS and PoR ,ogistics systems
Infrastructure
7
&ource+ #aasvla$te 2
33
-aritime transportation networks accessibility
=egree of ports represents the number of directions passengers or cargoes can travel at a
given port hich high degree means more connected ith other nodes. Also, beteenness of
ports is the proportion of the shortest paths >hich is the number of stops one has to pass to
travel beteen any to ports@ beteen central nodes that pass through the given central nodes
toards all the shortest paths. Thus, the higher the inde&, the easier it is to access a high
capacity and fre9uency global maritime freight transport system and thus effectively
participate to international trade.
According to the table above, port of Shanghai has less connection ith global mar!et than
Rotterdam, but it still has potential to develop. The construction of Jangsan deep/ater port
had increased the capacity and opportunity to attract more cargos, the lin!ages ith other
ports by maritime connection ould not be a ea!ness of Shanghai any more.
Table 3
8
1 #easurements of to ports. centrality in 4#$
Port =egree of ,entrality <eteenness of ,entrality
Shanghai 75 (7738.3('6
Rotterdam 87 78+?7.8753
Services
*omestic logistics cost
According to the table above, the collected data indicate that the port charges of Rotterdam is
higher than Shanghai. This means Port of Shanghai has advantage in the operation of
logistics service in the port as a result of loer logistics costs ith the comparing of Port of
Rotterdam.
Table 51 Port charges of to ports
9
8
&ource+2" 3u and 4" 5hu, 2))8 /mpirical anal!sis of the worldwide maritime transportation
networ$"
9
&ource+ 0ontainerisation International 2earboo$ 2))9, 6lo!ds 6ist ports of the world 2))9"
34
Port charges
>M@ total
Barbour and
2ight =ues
Pilotage
charge
Toage
charge
#ooringDun
mooring
,harges
Ancillary
charges
PoS '73*3 3585 56(5 67(( 66 3+5
PoR 3(+5* *'685 8?3* 8'8' *''+ *'(*
Also, 2ogistics performance inde& survey about the cost to importDe&port a 3+/foot container
or a semi/trailer>M@ by to ports. The average of cost are (?7.6(5 and 58(.'5
()
of Shanghai
and Rotterdam separately. The cost of Rotterdam is almost the double of Shanghai. This
result matches ith the conclusion that the logistics cost of Rotterdam is higher than
Shanghai.s.
'he size of port logistics
The construction of Jangsan deep/ay port pro%ect and #aasvla!e * pro%ect offers more
capacity of distribution of to ports. Thus, the production of to ports all increase, especially
the booming of cargo and container throughput of Shanghai. This figures indicate the needing
to enhance the construction of port infrastructure to meet the demand.
Table 61 ,omparison of production of to ports
''
,argo
throughput
'*
;roth rate>L@
from *++8
,ontainer
throughput
'(

;roth rate>L@
from *++8
PoS 65+.+ '+.5 (86,?57 '6.*
PoR 3*?.? *.+5 '','36 (.*5
()
&ource+ 6ogistics %erformance Inde7 86%I9, 2)()
((
&ource+ %ort of &hanghai statistics, %ort of 'otterdam statistics"
(2
-nit+ :ross weight ; (,))) metric tons"
(3
-nit+ .umber; (,))) </-s 8<went!=feet />uivalent -nits9
35
Operation process
.learance time
Shanghai1 a ne clearance model Hpreliminary customs clearance, release after actual
chec!ing the goodsH
(4
ould shorten the average time for customs clearance to * hrs 5( min,
hich is an 86L improvement over the traditional method. Also, paperless clearance reduced
the average customs clearance time to '5 hrs 5+ min for imports and 3(min for e&ports, a
reduction of 5.76 hours and 3.+8 hours respectively.
Rotterdam1 goods can be pre/cleared by electronic document transfer. ,entrali-ed clearance
procedure
(5
means electronical customs clearance collects all entry information by central
customs computer, the data ould be inputed and sent bac! a response to the agent by codes.
Additionally, single access point ould offer a safety and security controls, the importer only
needs to deal ith its customs administration.
Table 71 ,omparison of to ports clearance time and services
The average ,learance
time>days@
(6

Transparency of customs
clearance
(7
PoS *.53 (5.*?L
PoR +.785 87.5+L
Reliability of Supply Chain
'urn-round time
Port efficiency is directly affected turnaround time for vessel in harf. Turnaround time is
measured in hours, much less than a day in the best ports in the orld. 2onger turnaround
time means long stay in the port as a result of lo operation speed or port congestion
problems. The turnaround time in Port of Shanghai is also longer than Rotterdam. The
(4
#odel mean e=manifests for customs declaration is accepted instead of the traditional practive of
forestalling customs declaration until the arrival of goods" &ource+ shanghai customs government"
(5
&ource+ /uropa 0ustoms 0learance
(6
&ource+ 6ogistics %erformance Inde7, 2)()
(7
&ource+ 6ogistics %erformance Inde7, 2)()
36
potential reason are shortage of containers and customs arehousing reaching capacity hich
leads to congestion in the port. This ould be e&plained by the congestion level of to ports.
Table 81 The container ship turnaround time in to ports
PoS PoR
#easured by container ships
turnaround time of ports
*( hours and '3 minutes
(8
3 hours and (7 minutes
(9
.ongestion level
Also, the port congestion level of ports are measured by the delay of containers. "or instance1
2uo%in Terminal normally has */8
2)
days delay in Port of Shanghai, and E#) only has +/*
2(
days in Port of Rotterdam.
Business Environment
)nvestment opportunity
Shanghai1 the foreign trade volume of Shanghai ould increase (*.8L, around M(68.?
billion. In this case, e&ports and imports gre *7.3L and (8.5L separately in *+'+. "oreign
direct investment >"=I@ into Shanghai also raised to '5.'L in the meanhile. "ree trade
-ones and bonded arehouse facilities available.
Rotterdam1 port is a hub of international goods flo and an industrial comple& of global
stature. It as the biggest seaport in Europe faces to European mar!et of more than 5++ million
consumers
22
. PoR is e&pecting the port to gro from 3(+ million tonnes to anyhere
beteen 375 and 75+ million tonnes by *+(+. #oreover, larger funds by %oint investment
outside the $etherlands improved the general si-e of port infrastructure investments
(8
&ource+ 1 &trategic #odel of 0ompetition among 0ontainer %ort in .ortheast 1sia, 2ong=1n %ar$,
2))9
(9
&ource+ %ort statistics of 'otterdam
2)
&ource+ :lobal %orts 0ongestion Inde7, 2)()
2(
&ource+ :lobal %orts 0ongestion Inde7 !earboo$, 2)()
22
&ource+ :lobal=1rena
37
opportunity, appro&imately *5/(5 billion RUR investment in *+(+
23
. <onded arehouse
facilities available.
23
&ource+ %ort investor of %o'
38
.hapter 3 .onc,usions and Remar2s
In last chapter, the status and improvements are briefly e&plored, focusing on the
performance of to ports logistics systems. Port of Rotterdam as the orld/class port fit for
the re9uirement of H"irst 4orldH 2ogistics system hich is described by 4ood et al. >'??5@.
The infrastructure is highly developed, the standards of operating system is high, information
system alays has innovation. 4hile, Port of Shanghai is still stay an emerging level, even
through its container throughput has overta!en Singapore to be $o.' in *++?.
The conclusions can be divided into three categories as follos1 >l@ Port infrastructure
construction. >*@ Efficiency of port development strategy and operation process. >(@ Port
management system.
"irst, there is no doubt that Shanghai is emerging the busiest container port in the orld. Its
infrastructure, even related/transport infrastructure, has overta!en Port of Rotterdam.s in
9uantity level, hile the 9uality of infrastructure in Shanghai only around the middle level to
compare the rest of ports in the orld. The score %ust around the mean, even less it.
$otithstanding, the production of Port of Shanghai hich measured by cargo throughput
and container throughput stays the primary level around orld, it mostly benefited from
,hina economy.s groth and geographic advantages of port. Thus, the capacity of Shanghai
had improved, hile ShanghaiFs container/handling facilities services basically remain
bac!ard. Thus, it can be concluded that the construction of infrastructure in Shanghai still
failed to meet the fast groing demand.
Second, the one of physical obstacles is that insufficient strategies involved in port
development. And it has ris! of under/investment and lac! of innovation. The laggard
condition of distribution and infrastructure netor! has no become one of the restricting
factors for development of port logistics in Shanghai. #oreover, lac! of high efficient
logistics information form is a significant ea!ness of the development of Shanghai port
logistics. "urthermore, the cooperation beteen related departments is not smooth.
Third, shanghai still shorts of modern logistics hich provide 9uic!, reliable, fle&ible and
comprehensive services after the large investment of port infrastrucre. Port logistics lac!s of
overall/control and long/term co/operation, and source asting by largely constructions in
the port area. It ould be e&plained by the rest of attributes. The cost of domestic logistics of
Shanghai has comparative advantages than Rotterdam. It ould attracts more and more
39
foreign trade in the port even in ,hina. 4hile, the attributes Hoperation processH means the
efficiency of the clearance process hich as turned out a determinant indicator of efficiency
of logistics system of port. The days of clearance time in Shanghai is around tice even third
times of Rotterdam. Additionally, the score of its transparency of customs clearance %ust less
than half of Rotterdam.s. Thus, the score of indicators hich can effect the logistics
efficiency less than Rotterdam, hile the indicators. lead to the delay is far more than
Rotterdam.s. "urthermore, inade9uate technological capabilities of Shanghai are hard to carry
out a ide range of supply chain management activities. Thus, the reliability of Supply ,hain
of Shanghai still has to be improved.
To conclude, the improvement of port infrastructure and logistics system is alays the core of
the development of Shanghai. 4hile, the 9uality of logistics system is more important than
the production of ports. Port of Shanghai should strengthen its advantages and optimi-e
logistics operation system by learning from orld/class ports.
Remar2s
This paper has e&amined hub port of Shanghai and Rotterdam by revieing the e&isting
literature in terms of port spatial evolution. =uring this thesis, I had encounter some
difficulties and limitations. "irst, this paper has been ritten in my best approach. Boever,
due to time constraints I am not able to collect specific datas that ere needed for a detailed
analysis. Second, 2ogistics Performance Inde& and ;lobal ,ompetitiveness Inde& are analyst
in terms of nations not a certain port. Thus, the data from 2PI and ;,I is the closest data
hich I can find in such attributes. In the last but not least, there is missing data of the
aiting time of ports hich can indicate the delay in the port more specifically. Therefore, I
have to use specific e&amples by to container terminals not the hole port.
4)
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List of Appendices
Appendi& / U$,TA= Three ;eneration Port #odel
Appendi& / ,omparison of Port 2ogistics =evelopment #odels
Appendi& / The *5 most connected ports in the orldide maritime transportation netor!
Appendi& / The East/4est Shipping 2ine
Appendi7 / %".(A5 (hree 8eneration Port Mode,
42
$ource ( 12.'3* port marketing and the challenge of the third generation port, 4552
Appendi7 / .omparison of Port Logistics 5ee,opment Mode,s
#odel "eatures Respective
ports
Rotterdam port
model
2andlord type, unified planning by
government and ma!es their on decistions
by business.
Rotterdam port
Anterp port
model
,o/funding type, Hone/stop, door to door,
frame to frameH comprehensive service, and
perfect transportation netor!.
Anterp port
Singapore port
model
Aoint type, direct investment by
government, a free port policy, intensive
Singapore port
43
management, and service diversification.
Bong !ong model Independent type, self/organi-ing logistics
center, one/stop and integrated service,
sttention to personnel training.
Bong !ong
port
International
shipping center
model
,ontainer hub port, dense routes, deep
channel a complete netor! of collecting
and distributing, and perfect service
functions.
Shanghai port
#odel of port
regional logistics
system
Port area is the center. <uilding the Hport
logistics Par! /2ogistic ,enter /
=istribution ,enterH integrated model.
none
:one/port
interactive and
bonded port area
model
Establish the <onded 2ogistics Par!,
simplify procedures, speed up goods flo
and promote the development of a free port.
Ringdao port,
Tian%in port
Appendi7 / (he 23 most connected ports in the 1or,d1ide maritime transportation
net1or2
44
45
Appendi7 / (he $ast/9est Shipping Line
46