889
1 INTRODUCTION
The globalized economy of modern times connected
allregionsintheworldintoonecoherentwhole[2],
[6].TheproductsmanufacturedinEuropecanalsobe
receivedinthesamequalityfromotherregionssuch
as China [3]. Industrial enterprise may save a lot of
moneyusinglatest
technologies,aswellasproducers
located in the zones of cheap labour [13], [14]. The
only condition is good organization of transport,
which largely compensates longer distance, which
alsohastobepaidfor.Havingpartnersinthewhole
Europemakes itpossible for the forwardersto fulfil
therequirements
oftheclientsandtheydon’tneedto
owntheir owncarsoremploytheirowndrivers [4],
[15]. This cooperation lets carriers to increase the
rangeofpurchasersofshippingservices[1].
Examined transport enterprise developed an
innovative solution, that is, organization of railway
collective consignments. The company used the

opportunity to group smaller consignments into
larger ones, therefore, its services are more
economically beneficial. A strategy of analysed
transport enterprise has always been, among others,
grouping consignments. Well‐developed network of
warehouses‐terminals and regular connections
between 640 places in Europe allow to create an
effectiveflowofcargos
betweenanyplacesinEurope
[5],[7],[8],[9],[11].Analysedtransportenterpriseis
currentlynumberoneinEuropeanroadtransportand
thirdinglobalseaandairtransportusingthelatestIT
technologies(Fig.1).

Consolidation as a Key to Success
–
an European
Transport Enterprise Case Study
A.KuΕ›miΕ„ska‐FijaΕ‚kowska,Z.Łukasik&J.Kozyra
KazimierzPulaskiUniversityofTechnologyandHumanitiesinRadom,Radom,Poland
ABSTRACT:Transportisoneofthekeyelementsallowing toachievegoals,tasksandplans.Transport need
resultsfromthenecessityofmovingfromoneplacetoanother.Tomakeithappen,theresourceintheformofa
means
oftransportisnecessary.Anotheraspectisorganizationalactions.Thebasicsourceoftransportdemand
isdiversityofdistributionofthefactorsallowingtorunbusiness.Duetoglobalizationofeconomy,rangeand
frequency of transports have considerably increased. New logistic chains, networks of terminals and
intermodalconnectionsarebeingcreated
every year.Thegoalofalltheseactionsistoreducetransportcosts
andimprovethewhole process.Theauthorsofthisarticlesetagoal ofdefining theroleof optimizationof
transportcostsusingaconsolidationservice.Conductedanalysisconfirmedthatconsolidationservices reduce
thecostsoftransport
ofsmallcargos.

http://www.transnav.eu
the International Journal
on Marine Navigation
and Safety of Sea Transportation
Volume 13
Number 4
December 2019
DOI:10.12716/1001.13.04.24
890

Figure1.ITtechnologiesappliedintheexaminedtransportenterprise
2 THEBENEFITSOFCONSOLIDATION
ILLUSTRATEDWITHANEXAMPLEOFA
WAREHOUSEINNUREMBERG
Transport enterprise gets an inquiry from a
corporationhavingfive plantsaboutoptimizationof
transport costs. Using data about location of the
suppliers, size of cargos and destination, such
enterprise prepares a concept for every client. They

will all be different depending on location of the
suppliers, volume and place, in which enterprise is
located(table1)[16].
Thenextstepisassignmentofspecificsuppliersto
particularcollectivewarehousesandadding them to
existingtransportnetwork[10],[11],[17].

Figure2.Thelocationofallsuppliers(ownworkbasedon
theuseofOptimizingXYZ)
Analysedtransportenterprisehasmanycollective
warehouses,mainlyinGermany(Fig.3)

Table1.Alistofthesuppliersandaverageweeklyvolume
(ownwork)(LDMvalue‐lengthofaloadingbox[m])
_______________________________________________
Customer  Code City No.of LDM Mass
opallets[m] [kg]
_______________________________________________
A‐Monachium 10117 Berlin6 2,41400
A‐Monachium 30159 Hannover 2 0,4200
A‐Monachium 44135 Dortmund1 0,450
A‐Monachium 50667 Cologne 2 0,8100
A‐Monachium 95444 Bayreuth 3 1,2400
A‐Monachium 70173 Stuttgart 3 1,2300
B‐Praga33098 Paderbon 4 1,6400
B‐Praga37001 Goettingen1 0,4300
B‐Praga38440 Wolfsburg2 0,8300
B‐Praga14467 Podczdam3 1,2500
B‐Praga8001 Zwickau 2 0,8800
B‐Praga1099 Drezno 1 0,450
B‐Praga36001 Fulda2 0,4200
B‐Praga68159 Mannheim3 0,6500
B‐Praga76131
Karlsruhe 2 0,8300
B‐Praga86150 Augsburg 5 2  1000
B‐Praga93047 Regensburg6 2,41000
C‐Pisek85049 Ingolstadt 2 0,8300
C‐Pisek97070 Wurzburg  4 0,8500
C‐Pisek60306 Frankfurt 3 0,6600
C‐Pisek99001 Erfurt4 0,8500
C‐Pisek9001 Chemnitz 14 2,8
3300
D‐Brno7751 Jena  3 1,2500
D‐Brno69115 Heidelberg1 0,4200
D‐Brno70173 Stuttgart 2 0,4400
D‐Brno89073 Ulm  5 1  900
D‐Brno94315 Straubing 20 4  3800
E‐Sazburg  33501 Bielefeld 3 0,6500
E‐Salzburg  56001 Koblenz 20 8  8000
E‐Salzburg  74072 Heilbronn 4 1,6600
E‐Salzburg  96450 Colburg 5 1  1000
E‐Salzburg  92224 Amberg 1 0,4200
E‐Salzburg  83022 Rosenheim2 0,8350
_______________________________________________

891

Figure3.Anetworkofcollectivewarehouses
The most important warehouses of analysed
transportenterprisearepresentedintable2[16].
Table2. The locations of collective warehouses of the
analysedtransportenterprise
_______________________________________________
CityCode  XY
_______________________________________________
Bremen28307 53,08 8,8
Hamburg20095 53,55 9,99
Lohfelden34253 51,28 9,55
Dortmund44135 51,51 7,47
Luedenscheid58507 51,22 7,63
Waldlaubersheim  5544 49,93 7,83
Osnabruck49074 52,28 8,05
Mannheim68159 49,49 8,47
Frankfurt60306 50,11 8,68
Radeburg1468 51,21 13,72
Leipzig4003 51,34 12,37
Langenhagen30851 52,45 9,74
Schweinfurt97421 50,05
 10,22
Barbing93092 49  12,2
Heilbronn74072 49,14 9,21
Leopoldshohe33818 52,01 8,7
Nuremberg90402 49,45 11,08
Hagen58000 51,37 7,46
Doitzingen71254 48,83 9,07
Regensburg93047 49,01 12,1
Lichtenau91555 51,62 8,9
Hodenhagen29693 52,77 9,6
Arnstadt99310 50,84 10,95
Cologne50667 50,94 6,96
Oldenburg26121 53,14 8,21
Wilnsdorf
57234 50,82 8,1
Garbsen39217 52,43 9,6
Malterdingen79363 48,16 7,79
Trier54290 49,75 6,64
Augsburg86150 48,37 10,9
Essen45001 51,46 7,01
Maintal63477 50,15 8,82
Magdeburg39104 52,12 11,63
Haiger35708 50,74 8,21
Stuttgart70173 48,78 9,18
Friedrichshafen88045 47,66 9,48
Waidhaus92726 49,63 12,5
Coburg96450 50,26 10,96

Dusseldorf40210 51,23 6,77
_______________________________________________
However, most of them are only warehouses
storing temporarily in order to organize transports,
Strategic warehouses of the transport enterprise are
presentedintable3.
Table3.Strategicwarehousesofthetransportenterprise
_______________________________________________
CityCode  XY
_______________________________________________
Luedenscheid51,22  7,63  58507
Frankfurt50,11  8,68  60306
Leipzig51,34  12,37  4003
Langenhagen52,45  9,74  30851
Heilbronn49,14  9,21  74072
Nuremberg49,45  11,08  90402
Hagen51,37  7,46  58000
_______________________________________________

After calculations made by the application, the
suppliers will be assigned to specific collective
warehouse(Fig.4)

Figure4. The assignment of the suppliers to specific
collective warehouses (own work based  on the use of
OptimizingXYZ)
Final destination of all loading points will be a
warehouse in Nuremberg, the best one in Germany
whenitcomestooperationalissues(Fig.5).Itisalso
well‐locatedtowardslocationoftheclients.Thisunit
willalsodealwithorganizationoftransportsforsome
suppliers.

Figure5. The location of the suppliers towards collective
warehouse(ownworkbasedontheuseofOptimizingXYZ)
892
Analysedtransportcompanyusingwell‐organized
network of collective warehouses and transitional
terminals can deliver all cargos from Germany to
Nurembergwithin2workingdays(Fig.6).

Figure6. The location of nominated warehouses towards
Nuremberg (own work based on the use of Optimizing
XYZ)
The last stage will be delivery of consolidated
goodsfromNurembergtoallclients(Fig.7).

Figure7. The location of the clients towards collective
warehouse(ownworkbasedontheuseofOptimizingXYZ)
The average speed of transit in the analysis is
65km/h.LDMvalue,appliedintheanalysisisaunit
representing length of a loading box, measured in
meters. Transport costs based on average rate on
current transport market and consolidation tariff of
thetransportenterprisearepresentedintable4.
Table4. The average rate per one kilometre for particular
cars(ownworkbasedonthe offers of various forwarding
companies)
_______________________________________________
Car Dimensions 0‐300km 301‐800km>801km
type (length/s/h)
_______________________________________________
3,5t 6,0/2,4/2,7m 0,8ξˆ±β‚¬/km0,75ξˆ±β‚¬/km 0,65ξˆ±β‚¬/km
6t  7,2/2,4/207m 0,9ξˆ±β‚¬/km0,85ξˆ±β‚¬/km 0,8ξˆ±β‚¬/km
21t 13,3/2,5/3m  1,3ξˆ±β‚¬/km1,25ξˆ±β‚¬/km 1,2ξˆ±β‚¬/km
_______________________________________________

Duetolocationofspecificsuppliers,sizeofcargos
anddestination,transportenterpriseoffersclientsone
ofthesolutionsofpt.2.[16]
3 THECONSOLIDATIONOFDIRECTCAR
ILLUSTRATEDWITHANEXAMPLEOFCLIENT
A
Client A, located in Munich presents current
organization of transports, run by other forwarding
company(table
5).
Table5.TransportscheduleofclientA(ownwork)
_______________________________________________
Code City  Date HourD  WT DT
[km] [h] [h]
_______________________________________________
10117Berlin2.07 08:00‐09:00 0  1  0
30159Hannover 2.07 13:30‐14:30 286 5,54,5
44135Dortmund 2.07 18:00‐19:00 212 11  8
50667Cologne  3.07 08:30‐09:30 93  2,51,5
95444Bayreuth 3.07 17:00‐18:00 954 11  9
70173Stuttgart4.07 10:30‐11:30 281 4,54,5
80331Monachium 4.07
 16:00239 9  9
_______________________________________________
1565
_______________________________________________
Dξˆ±β€“ξˆ±Distance WTξˆ±β€“ξˆ±Worktime  DTξˆ±β€“ξˆ±DrivingTime

Inthiscase,transitlastsoneandahalfday.Itisan
important factor affecting financial situation of the
enterprise. The longer time of transport, the higher
costsoffrozencapitalandhigherriskintheeventthat
there are no components for production. Many
optionsoftransportsavings
arenotintroduceddueto
theimpactontheleveloftheso‐calledinventorythat
representsmoneydepositedinparts,thosestoredina
plant and currently transported. The whole process
starts at the moment of receipt of goods from a
supplierwhopreparesaconsignmentandinvoicein
SAP.
 
Duetosizeofacargo,clientAorders 6‐tonnecar,
the whole distance is 1565 km, the average cost per
one kilometre for such car is 0,8€, the cost of
additional place, the so‐called stop 25β‚¬ξˆ± (Fig.8).
Therefore,freightis1377€.

Figure8.Currentorganizationofclient’sA  transport(own
workbasedonGoogleMaps)
Using determined weight tariff that verifies costs
oftransportofcargostothewarehouseinNuremberg
towardspostalcodeofasupplier,therateforreceipt
893
ofallsuppliersandforhandlingoperationsis359,09€.
The disposal of a car is 89%, therefore, flow
organizationiswell‐optimized(table6).Theproblem
isdistancethatcarmustcovertotakeall,evensmall
cargos.
Table6.ThecostofaconsolidationserviceforaclientA
_______________________________________________
Code City NumberLDMMassHandlingTransport
ofpallets [m][kg]
_______________________________________________
10117Berlin6  2,4 1400 12ξˆ±β‚¬ξˆ±ξˆ± 169,29ξˆ±β‚¬ξˆ±
30159Hannover 2  0,4 200 4ξˆ±β‚¬ξˆ±ξˆ±31,41ξˆ±β‚¬ξˆ±
44135Dortmund 1  0,4 50  2ξˆ±β‚¬ξˆ±ξˆ±16,69ξˆ±β‚¬ξˆ±
50667Cologne  2  0,8 100 4ξˆ±β‚¬ξˆ±ξˆ±22,02ξˆ±β‚¬ξˆ±
95444Bayreuth 3  1,2 400 6ξˆ±β‚¬ξˆ±ξˆ±45,44ξˆ±β‚¬ξˆ±
70173Stuttgart3  1,2 300 6
ξˆ±β‚¬ξˆ±ξˆ±40,24ξˆ±β‚¬ξˆ±
_______________________________________________
Total  17  6,4 2450 34ξˆ±β‚¬ξˆ±ξˆ± 325,09ξˆ±β‚¬ξˆ±
_______________________________________________
Disposalofthecar88,89% 48,83%  359,09ξˆ±β‚¬ξˆ±
_______________________________________________

Analysed transport enterprise offers delivery of
everycargofromGermanywithin2workingdays.In
thiscase,goodsloadedon02/07canbecollectedina
warehouse only on 04/07. In order to optimize the
timeofdelivery, all cargosplannedafter02/07must
bespeededuptothis
day(table7).
Cargowillbereadyat9o’clockandwillbetaken
by6‐tonne car, distancefromNurembergto Munich
is195km,accordingtopricelistofaveragecosts,the
rateperonekilometreforthedistanceof0‐300kmis
0,9€/km.Thefreightis175,5€.
Totaltransitistwoand
ahalfdays,thatis,onedaymorethannow(table8)
(Fig.9).

Figure9.TherouteNurembergξˆ±β€ξˆ±Munich(ownworkbased
ontheuseofOptimizingXYZ)
Comparing current costs with a proposed offer,
clientmaysaveEUR40thousand(table9).
Thereisalsoanissueofdeterminingtheimpactof
extendedtransit onthecosts frozen inmaterial [12].
Thevalueofcargoandnumberofproductiondaysof
a plant will be required. The value
 of goods is fifty
thousandeuro,withfive‐dayproductionline,itisten
thousand euro a day. Increasing the transit by one
day will have a negative impact in the value of one
day,thatis,ten thousandeuro.Comparinglosses in
materialandsavingintransport,theresult
ispositive
β€ξˆ±thirtythousandeuro(table10).

Table7.TimeofdeliveryofcargostoNuremberg(ClientA)Ownwork
__________________________________________________________________________________________________
Code CityDate Hour  Code CityDate  Hour
__________________________________________________________________________________________________
10117 Berlin 2.07 08:00  90402 Nuremberg4.07 08:00
30159 Hannover 2.07 13:00  90402 Nuremberg4.07 08:00
44135 Dortmund 2.07 18:00  90402 Nuremberg4.07 08:00
50667 Cologne  2.07 08:30  90402 Nuremberg4.07 08:00
95444 Bayreuth 2.07 17:00  90402 Nuremberg4.07 08:00
70173 Stuttgart2.07 10:30  90402 Nuremberg4.07 08:00
__________________________________________________________________________________________________

Table8.TransportofconsolidatedcargotoMunich(ownwork)
__________________________________________________________________________________________________
Code CityDate Hour  Code CityDate  Hour
__________________________________________________________________________________________________
90402 Nuremberg 4.07 09:00  80331 Monachium 4.07 11:30
__________________________________________________________________________________________________

Table9.Thesavingsofaclient Athankstoproposedofferofatransportcompany(ownwork)
__________________________________________________________________________________________________
RouteCartypeDistance Feet costs[€]
__________________________________________________________________________________________________
Suppliersξˆ±β€>ClientAMonachium6t1565  5  1377,00
Currenttotalcost1377,00
Suppliersξˆ±β€>Nurembergconsolidation359,10
Norymbergia‐>ClientAMonachium  6t195  0  175,50
Theproposedtotalcost534,59
Savingsoftheweekξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±β€842,41
Annualsavingsξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±β€40435,68
__________________________________________________________________________________________________

894
Table10. The comparison of transport savings and
inventorylossesofaclientA(ownwork)
_______________________________________________
Valueofthegoods[€]50000,00
Numberofproductiondays5
Valueofthecommodity/day[€]10000,00
Savingsintransportcosts[€]ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±β€ξˆ±40435,68
Inventorycostsincreased[€]10000,00
Finalbalance[€]ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±ξˆ±β€ξˆ±30435,68
_______________________________________________
4 SUMMARY
The digitization of transport processes is possible
thanks to systems of management of transports and
invoices, or applications monitoring position of the
cars. The programs optimizing costs are ideal
solutions for enterprises having a network of
terminals. These networks are becoming more and
more important on the market
 due to pressure on
reductionofcosts.
In this article, the authors set a goal,  which is
defining the role of optimization of transport costs
using a consolidation service. Conducted analysis
allowed to prove that consolidation services reduce
thecostsoftransportofsmallcargos.Intheeventof
direct
transports, the cars must cover many
kilometres, only to take one small cargos or pallet.
Medium and large cargos are not cost‐effective for
suchorganizations,however,directandconsolidation
methodcan be combined to getoptimal results. The
impact on inventory costs was also taken into
considerationintheanalysis.
Extendedtimeoftransit,
causedbytheuseofaconsolidationserviceshouldbe
inmostcasescoveredbytransportsavings.
LITERATURE
[1]Hanbazazah A.S., Abril L., Erkoc M., Shaikh N. (2019)
Freightconsolidationwithdivisibleshipments,delivery
time windows, and piecewise transportation costs.
European Journal of Operational Research 276(1), pp.
187‐201
[2]KoliΕ„ski A., Stajniak M.  (2016) EfektywnoΕ›Δ‡ξˆ± procesΓ³w
transportowych. WspΓ³Ε‚czesne problemy i trendy
rozwoju,Radom,InstytutNaukowo‐Wydawniczy

[3]Bookbinder,J.H.,Elhedhli,S.,Li,Z.(2015)Theair‐cargo
consolidation problem with pivot weight: Models and
solutionmethods,ComputersandOperationsResearch,
59,pp.22‐32
[4]Croxton,K.L.,Gendron,B.,Magnanti,T.L.(2003)Models
and methods for merge‐in‐transit operations.
TransportationScience,37(1),pp.1‐
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