Bert Vernimmen (University of Antwerp – Faculty of Applied Economics, Department of Transport and Regional Economics) Frank Witlox (Ghent University – Faculty of Sciences, Department of Geography)
Abstract
This paper analyses modal choice in freight transport from the viewpoint of a shipper/receiver. The analysis is based on the well-known concept of "total logistics costs". This implies that explicit attention is paid to all costs in the supply chain that are influenced by the choice of transport mode. After a literature review on the inventory-theoretic approach to modal choice, a case study is presented to illustrate the concept of total logistics costs. A comparison is made between road haulage and inland navigation for the transport of bulk goods. The trade-off between transportation costs and inventory costs is shown: while inland navigation has lower transportation costs than road haulage, its inventory costs are higher. Due to the fact that the goods are of relatively high value, inland navigation turns out to be more expensive than road haulage. However, it is shown that the balance would turn in favour of inland navigation when a smaller vessel type than the current one would be used.
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Find related papers by JEL classification: L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
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