1. business and industrial
2. logistics
3. air freight

DIFFERENCES BETWEEN UNIMODAL AND INTERMODAL
TRANSPORTATION NETWORKS. A MULTI CRITERIA DECISION
MAKING TECHNIQUE FOR CARRIER SELECTION IN EKOL
LOGISTICS.
Master Thesis
Christofidis Georgios
GC414465
Supervisor
Associate Professor: Marcel Turkensteen
Aarhus University
Business and Social Sciences
Msc in Logistics and Supply Chain Management
March 2015
Acknowledgements
This thesis is the last step of my Master in Logistics and Supply Chain Management in Aarhus
School of Business. My work has been carried out since April 2014 divided between Greece
and Denmark. I feel deeply indebted for the assistance of few people without their guidance
this project would be impossible to conclude.
First of all, I would like to thank my supervisor Mr. Marcel Turkensteen for his valuable
mentoring and food for thinking. His constructive feedback provided me with "light" when the
days seemed "grey". Secondly, the manager of Ekol Logistics GR Mr. Dimitris Batakis, whose
professional expertise and knowledge supplied my research with invaluable empirical and
theoretical data. In addition, Mr. Stathis Pagonis, the operational manager of Ekol Logistics GR
is the one who inspired me to get involved in the field of intermodal transportation.
Last but not least, I would like to thank all the members of my big family for their outmost
support and love. I owe them the world.
Georgios Christofidis
Aarhus, February 2015
i
Abstract
Several exogenous factors affect transportation nowadays. Globalization, financial crisis and
political decisions among others affect the decision of carrier and mode selection.
Intermodalism, is nowadays a transportation trend that more and more companies tend to
select for their shipments. They have realized the advantages of a homogenous containerized
shipment that through alternative modes (road, ship, rail) treats their products as a whole
without interfering in handling the product itself once changing modes. This way they tackle
utile bureaucracy and achieve financial profits through economies of scale. In addition, they
improve security by reducing damages and losses. The European Commission released several
programs such as "Motorways Of The Sea" or CREAM1 project, promoting intermodality as a
way to cope with road congestion and other transportation externalities like pollution.
However, the decision making for a shipper still remains vague since intermodal transportation
is a complex system with many criteria to take into consideration.
The purpose of this thesis is on the one hand, to present the various characteristics of
unimodal compared to intermodal transportation, assessed by the assistance of Ekol Logistics.
In an illustrative case the writer will demonstrate an intermodal trip in relation to Ekol Logistics
network. And on the other hand, to develop a decision making framework that will serve as a
guideline for the members of the company to better understand their customers' decisions.
For the second pylon of the thesis the writer conducted an extensive literature review to
identify the selection criteria that affect a shipper's decision. The outcome was to divide a
company's criteria in relation to their size, their international or domestic interest, the size of
their shipment, the difference in perception between shippers and carriers and so on. A review
of the relevant transportation choice models was followed. In conclusion, the writer developed
an AHP technique which was the most relevant and handy to use since it combines qualitative
and quantitative criteria to carrier selection. In developing the former technique, the thesis
managed on providing a theoretical multi criteria decision making framework to Ekol Logistics
for further use by the company or its customers, depending on the type of each shipper and its
particular needs. However, the validity of the model wasn't tested yet and therefore it is
essential to perform an applicability test for reliable outcomes.
1
Customer-driven Rail-freight services on a European mega-corridor based on Advanced business and
operating Models Source: (http://www.cream-project.eu/home/index.php).
ii
Contents
Acknowledgements.................................................................................................................... i
Abstract .................................................................................................................................... ii
Chapter 1 .................................................................................................................................. 1
1.1 Introduction .................................................................................................................... 1
1.2 Problem Formulation and Research Questions ................................................................ 2
1.3 Scope of the Research ..................................................................................................... 4
1.4 Research Methodology .................................................................................................... 5
Chapter 2 .................................................................................................................................. 7
2.1 Ingredients of a Long-Haul freight transportation network .............................................. 7
2.1.1 Introduction ............................................................................................................. 7
2.2 Types of freight transportation ........................................................................................ 8
2.2.1 Customized transportation ....................................................................................... 8
2.2.2 Consolidation transportation .................................................................................... 9
2.3 Unimodal transportation ................................................................................................. 9
2.3.1 Road transportation ................................................................................................. 9
2.4 Intermodal transportation ............................................................................................. 11
2.4.1 Transit containers ................................................................................................... 12
2.4.2 Intermodal terminal................................................................................................ 14
2.5 Intermodal transportation in European Union ............................................................... 16
Chapter 3 ................................................................................................................................ 18
3.1 Company overview ........................................................................................................ 18
3.2 Ekol Logistics intermodal operations ............................................................................. 19
3.3 Ekol Logistics road transportation .................................................................................. 20
3.4 Greek Branch................................................................................................................. 21
3.4.1 The geographical role of Greece ............................................................................. 23
3.4.2 The profile of Ekol Logistics customers .................................................................... 24
Chapter 4 ................................................................................................................................ 25
4.1 The carrier and modal choice determinants ................................................................... 25
4.2 Identifying the Key Attributes for selecting a carrier ...................................................... 27
4.2.1 Difference in perceptions in theoretical context ..................................................... 28
4.2.2 Relationships between shipper and carrier ............................................................. 29
4.2.3 Shipper perception determinants of modal choice .................................................. 31
iii
4.2.4 Key differences in attributes in international setup ................................................. 32
4.2.5 Does the size matter? ............................................................................................. 34
4.2.6 The Environmental Factor ....................................................................................... 35
4.3 Criticism of the Scoring Attributes ................................................................................. 37
Chapter 5 ................................................................................................................................ 38
5.1 The Decision Making Process for Carrier and Mode selection ........................................ 38
5.2 Transportation Choice Models ....................................................................................... 39
5.2.1 Economic Model Determinants ............................................................................... 39
5.2.2 The classical economic model ................................................................................. 39
5.2.3 The Inventory-Theoretic Problem ........................................................................... 40
5.2.4 The Trade-Off Model .............................................................................................. 41
5.2.5 The Constrained Optimization Model ..................................................................... 42
5.3 The Inductive Modeling Approach. A validation tool for Decision Making processes .. 42
Chapter 6 ................................................................................................................................ 44
6.1 The MCDM Models for Carrier Selection........................................................................ 44
6.2 Literature review ........................................................................................................... 45
6.2.1 Data Envelopment Analysis (DEA) ........................................................................... 47
6.2.2 Analytical Hierarchy Process (AHP) ......................................................................... 47
6.3 Ekol's case ..................................................................................................................... 48
6.3.1 DEA ........................................................................................................................ 49
6.3.2 AHP ........................................................................................................................ 49
6.4 Implementation of AHP ................................................................................................. 50
Step 1 ................................................................................................................................. 50
6.4.1 Definition of the Problem ....................................................................................... 50
6.4.2 Fictional scenario .................................................................................................... 50
6.4.3 Goal ........................................................................................................................ 51
6.4.4 Corporate Objectives .............................................................................................. 51
6.4.5 Criteria and Sub-Criteria ......................................................................................... 51
6.4.6 Ratings ................................................................................................................... 52
Step 2 ................................................................................................................................. 54
Step 3 ................................................................................................................................. 55
Step 4 ................................................................................................................................. 55
6.5 Findings......................................................................................................................... 55
Chapter 7 ................................................................................................................................ 58
iv
7.1 Conclusion..................................................................................................................... 58
7.2 Future work................................................................................................................... 58
Bibliography............................................................................................................................ 60
List of Figures .......................................................................................................................... 64
List of Tables ........................................................................................................................... 65
v
Chapter 1
In the first chapter, an introduction will attempt to familiarize the reader with the scientific
subject of freight transportation as well as present; the formulation of the problem, the
research questions and the employed research methodology.
1.1 Introduction
The terms of logistics and supply chain management are highly correlated with the
transportation of goods. Freight transportation is an important component in today’s
economy. It is the physical process of transporting commercial goods, commodities and cargo.
It is a key supply chain component used to ensure the efficient movement and timely
availability of finished products and raw materials (Crainic, 2002). In order to do so, several
types of vehicles like trucks, ships and trains are used, as well as, relative components
including trailers, containers or pallets. The economic crisis in 2008 led many companies to
reevaluate their processes in order to reduce costs and increase productivity. The
transportation cost accounts for almost 10% of the final price of the product (Rodrigue, 2013).
In other cases such as in abundant countries like Norway, it was estimated that the
transportation costs exceeded the 50%, reinforcing the assertion that topography plays a big
role on transportation cost (Pedersen E, 1998). In a competitive environment, shippers,
carriers and logistics service providers (LSP) are seeking for ways to minimize this cost
alongside with satisfying alternative criteria for their customers. This may be environmental
factors, fulfilling demand or achieving lower lead times.
The current competitive business environment assists for the development of transportation
services and on the same time promotes globalization. Swedish journalist T. Larsson provides
an accurate definition of it: “Globalization is the process of world shrinkage, of distances
getting shorter, things moving closer. It pertains to the increasing ease with which somebody
on one side of the world can interact, to mutual benefit, with somebody on the other side of the
world.” (Larsson, 2001). The world is getting smaller in a way that eases connectivity between
markets. Now, greater than before, products and services are delivered to fulfill demand from
the one side of the planet to the other. Companies meet current trends by outsourcing some
or whole part of their operations, leading to greater distances travelled. This way they achieve
lower costs by taking advantage of lower manufacturing wages in developing countries
(Ghiani, Laporte, & Musmanno, 2004).
In his survey, of optimization models for long-haul freight transportation, Crainic (Crainic,
2002) states, that freight transportation companies must meet (i) high performance levels of
economic efficiency and on the same time (ii) provide efficient quality of services. The market
1
is still mainly cost-driven and a transportation company is seeking for ways to make a profit.
Furthermore, the quality of service involves examples such as small or no inventory alongside
with just in time (JIT) procurement. Searching for ways to lower their costs and on the same
time allowing them with greater flexibility over the mode of transport they will use, companies
came across with several optimization transportation strategies. Among the widely used ones
is intermodal transportation, the science that deals with the movement of goods between and
among various modes of transportation (Mahoney, 1985). In accordance, Crainic (Teodor
Gabriel Crainic, Intermodal Transportation, 2005) defines it as the transportation of a person
or a load from its origin to its destination by a sequence of at least two transportation modes,
the transfer from one mode to the next being performed at an intermodal terminal.
Intermodal transportation prerequisites that shipments are mostly containerized and
transferred by a combination of truck, ship, train or air until they reach their final destination.
The shipments can be divided in general or bulk cargo. Bulk cargo like coal, grains, petroleum
can be shipped without containers by pipelines, unit trains or barges. In the case of general
cargo, that can be transported in containers. If the general cargo’s form is loose or cannot fit in
standard containers then is loaded in unit load devices (ULD) a pallet, box, platform or
container that allows large quantity of cargo to be pilled in order to be unitized into a single
unit (Mahoney, 1985). In general terms the objective of intermodal transportation is to
maintain continuous flow for the shipments and minimize the cost and time that shipments
come to suspend.
1.2 Problem Formulation and Research Questions
The purpose of the given thesis is:
i.
To present the differences between unimodal and intermodal transportation
networks.
ii.
To search for the various characteristics that affect a supplier's choice in relation to
the mode and carrier selection.
iii.
To develop a decision making tool that provides information to Ekol Logistics about
supplier preferences.
For this case, the researcher will be based on the assistance of Ekol Logistics. Their
transportation network and policies will be used to develop a decision making transportation
tool from their client’s perspective.
2
I first came in contact with the company’s Greek department over a year ago and we discussed
the opportunity of conducting a research about their future expansion of their transportation
network. The concept of intermodal transportation was a newly launched project for Greek
standards in large scale and the company was eager to take advantage of the strategically
position of Greece in Europe to offer to the mother company, which is located in Turkey, a
greater variety of options. One of the objectives was to fulfill demand in the otherwise idle
markets of Serbia, FYROM and Slovenia. On the other hand, they wanted to offer an
alternative transportation option instead of the one that it’s already being implemented,
serving as a backup plan. After the successful implementation, they currently operate in
markets that exceed from the Balkan peninsula all the way across to central and eastern
Europe.
The Greek department is on the verge of introducing a multi mode transportation model
including ship, truck and rail. Using the port of Lavrio (EL) as their transshipment point they
fulfill the southern part of Greece’s demand by including intermodal loads to the already set
up network by the mother company. The northern part of Greece is using Thessaloniki (EL) as
their main hub. On the near future they plan on launching a new intermodal trip starting from
Thessaloniki (EL) until Ekol’s hub in Ludwigshafen (DE) and Duisburg (DE). Until now they
operate rail trips to satisfy the demand in Balkan countries and more specifically in FYROM
(Macedonia), Serbia and Slovenia.
The company is eager to search for a decision making tool that would present the various
characteristics that affect its customer’s choice in relation to the mode of transportation they
will finally use. For a customer of Ekol important factors like the on-time and secure delivery of
the shipment need to be fulfilled. These factors determine the service levels provided by Ekol.
Nevertheless, the main decision making factor remains the transportation cost. The use of rail
and road transportation is a complicated system and generates problems that need to be
tackled. These may result to slower and less reliable transportation. On the other hand,
economies of scale provide a better price which is, as previously stated, the key decision
factor. This tool would also assist on demand fluctuation problem as it would provide
information about customer preferences.
The client’s selection criteria vary considerably from industry to industry and mostly depend
on the nature of the good to be transported, but some key factors that affect its choice could
be:

Carrier’s capacity and features
3

On time delivery

Efficient service levels

Reputation, reliability and integrity

Responsiveness to urgent situations of the supplier

Financial status

Tracking of the shipments and communication channels

Safety issues

Multimodal services

Right feedback and correct invoices

Custom clearances issues
Source: (Logistics Cluster, 2014)
The central research questions this thesis is planning on answering are the following:
1. How are the unimodal and intermodal transportation trips being implemented from
theory to practice?
2. Which are the various decision criteria that affect a company's choice over the carrier
and mode of transportation it will use?
3. How is the case of Ekol linked, with the identified decision criteria?
4. Which are the theoretical models that shall be applied to form a carrier decision
making tool in order to suit the decision criteria?
Before proceeding we have to delimit our research in order to specify the field of study. The
four questions might seem generic and the researcher will attempt to exemplify all of the
problems associated with the former.
1.3 Scope of the Research
The following thesis will compare the general characteristics of the two transportation policies
and present the selection criteria that affect a customer’s choice depending on the previously
mentioned key factors. Concerning the first research question, the scope will not include all of
the available transportation modes but will only focus on the road, rail and to some extent to
sea transportation designated by our case, for economy of space. This will exclude air and
pipeline modes from the research. Even though sea transportation is a key concept for Ekol’s
intermodal plan since the acquisition of 3 privately owned RoRo (Roll-on/Roll-off) ships in
2013, the researcher will only include it to the journey generated to satisfy the Southern part
of Greece’s demand. The current intermodal journey for the mother company sets off from
4
Turkey and ends in Germany’s hub and vice versa, where the shipments are unloaded for
further distribution. The relevance of the latter to our case is that the transshipment point of
the trip includes Greece and the port of Lavrio (EL) where shipments are loaded to satisfy the
demand from Southern Greece to Northern Europe and back.
In regards to the second question, the mode selection under a customer’s spectrum is already
an exemplified statement. The supplier has to choose in between road and intermodal
transportation for his shipment. However, the scope of research will focus on the
determinants linked to the nature of the freight that needs to be transferred. The research will
be narrowed and provide examples of a specific industry and more in particular for a fruit and
vegetables company. On the second part of the question the carrier selection criteria will be
reviewed from relevant literature depending on:
i.
The difference on perceptions between carrier and supplier
ii.
Their state of relationship
iii.
International or domestic transportation
iv.
Size of the shipper
v.
Environmental concerns
To answer the third research question, the relevant scientific literature will be reviewed. This
includes peer-reviewed articles, books, journals and relevant published dissertations. The
methodology to be followed will cover a review and subsequently a selection of only the
relevant research to our case. The features set of the Ekol case will firstly be presented in
details in order to be aligned to the theoretical models. These include on the one hand the
characteristics of unimodal (road transportation) for long-haul freight transportation and on
the other a comparison to an intermodal system.
The fourth question relates to the Multi Criteria Decision Making (MCDM) techniques that
shall be applied in correlation with the previous identified decision making criteria to form a
model, aligned to Ekol's costumers. The proposed Analytical Hierarchy Process (AHP)
technique will be developed in depth. This will exclude other identified MCDM models with
the proper justification.
1.4 Research Methodology
The employed scientific method will be a combinatorial research from data taken directly from
Ekol, and literature review. The thesis will be divided in two parts. On the first part, a
description of the two modes characteristics will be presented. Additionally the writer will
5
exemplify how an intermodal network is being set up, as well as, identifying its key
components. The connection from theory to real world represented by Ekol will follow. The
key attributes that affect a customer of Ekol in selecting a carrier and mode for his
transportation needs will be produced based on the literature. The main part of the analysis
will be dedicated to the development of the decision making tool based on the several criteria
related to the characteristics of the industry that a customer of Ekol is engaged to. A set of
MCDM techniques will be presented.
6
Chapter 2
In Chapter 2, the writer introduces to the reader, the components of a long-haul freight
transportation network. This refers to long distance deliveries between two points. In addition
an analysis of an unimodal and intermodal system will serve as the basis for better
understanding Ekol's case study. Relative definitions will be given according to the literature to
form a solid background for the base of the next considerations.
2.1 Ingredients of a Long-Haul freight transportation network
2.1.1 Introduction
The long-haul freight transportation is defined by Ghiani et.al (Ghiani, Laporte, & Musmanno,
2004) as the delivery of goods over long distances between terminals and other facilities like
warehouses. In order to be explicit about the terms being used we have to define the above.
Items are the small units in which goods are transported in. That could be a small delivery box.
The combination of more than one item that travel together as one unit and have the same
starting and destination point are called shipments. Lastly, the load is the group of shipments
that are loaded in the same vehicle and travel together (Hall, 1987). The goods may be
transported by rail, truck, ship and airplane or by any combination of modes. The parties
involved in a freight transportation network exceed from the shippers and the carriers. The
shippers are the ones that produce demand for transportation or intermediate companies, the
brokers, who also generate demand. Carriers on the contrary, supply transportation services
(Crainic, 2002). These may be the railways, motor carriers or shipping lines. It is common that
governments construct and operate transportation infrastructures like rail facilities, ports,
roads and airports in order to regulate several aspects of the industry and tax it (Ghiani,
Laporte, & Musmanno, 2004). The long-haul network is generally divided in three sections
described by SteadieSeifi et al. (SteadieSeifi, Dellaert, Nuijten, Woensel, & Raoufi, 2013):
1. The pre-haul also known as the first mile. The process of gathering all the shipments.
The use of trucking is the most common for completing this step.
2. The long-haul transportation. It may be conducted via road, rail, air and water.
3. The end-haul transportation, known as the last mile also mostly conducted by trucks.
7
Figure 1: The long-haul Freight transportation
Source: (SteadieSeifi, Dellaert, Nuijten, Woensel, & Raoufi, 2013)
The loads can be divided in TL trucking (truckload) or LTL (less than truckload). A TL carrier is a
trucking company who contracts an entire load to just one customer. In contrast, the LTL
carrier mixes the freight from several customers to each trailer. In consolidation type
transportation like LTL trucking, the service is not individualized. It is assumed that a driver can
move freight of different shippers to different destinations. The network it operates consists of
terminals that are connected physically (by roads, railway lines) or virtually (by air or sea). The
End-of-line terminal is the place where small shipments are brought to be consolidated into
larger shipments (Ghiani, Laporte, & Musmanno, 2004).
2.2 Types of freight transportation
The researcher will focus on the two types of transportation relevant to our case. The
customized transportation where the demand for a service is solely dedicated to a specific
customer and the consolidation transportation in which several shipments from various
customers are being consolidating to a designated area, specifically constructed for this
purpose and delivered to each point of destination.
2.2.1 Customized transportation
Customized transportation is assigned to an individual customer. A TL trucking offers door-todoor services when the demand arises. That takes place under the notification of the customer
that needs a transportation service and triggers the assigned driver to move to the picking
point and load the shipment. After the trip, the driver unloads the truck to the designated area
and waits for dispatcher’s signal that will trigger another assignment (Crainic, 2002).
Nevertheless, it is not uncommon that the driver waits to the unloading destination for some
time before a new shipment needs to be transported due to demand fluctuation. Therefore,
8
the dispatcher often activates the movement only when is certain of the profitable
transaction. That is when it is certain that the truck will return full or some nearby load will be
ready for pickup. Otherwise the driver will have to wait which might prove costly on the
turnover.
2.2.2 Consolidation transportation
According to Hall R.W. (Hall, 1987) consolidation is the procedure of combining different items
or shipments that are being produced and used from alternative locations at different time
intervals, into single vehicle loads. The idea is to homogenize loads in containers, in an end-ofline area so that are easier to transfer. This way the demand from various shippers is satisfied
simultaneously with the use of the same vehicle. Consolidation transportation can turn out to
be a rather complex problem for carriers, depending on the expectations of every customer
respectively that need to be satisfied. The nature of the product that needs to be transferred
usually indicates these transportation requirements. For instance, when it comes for
susceptible products the transfer lead times are of great importance. As Crainic states (Crainic,
2002) the carrier must propose a set of routes each with its own operational characteristics.
The proposed schedule must meet or at least come close to departure and arrival times in
compliance to the operational plan which was formerly set.
2.3 Unimodal transportation
The transfer between the vehicles of the same mode can be defined as unimodal transfer. In
most of the cases these regard road transportation but can also include ship, train or air.
Usually unimodal transfers are easier to handle and accomplish, since the vehicles are similar
and operate at the same medium (Mahoney, 1985). For instance, a carload can be transferred
by one train to another only by switching the railcar. The latter takes place also when
transporting a trailerload from one tractor to another. In this thesis we will focus on road
transportation since it is involved in our case study.
2.3.1 Road transportation
The road transportation offers accurate door-to-door services. The flexibility of gathering a
shipment and delivering it to the door of the buyer, provides a service incomparable to any
other mode of transport. It does not require big investment funds to gain and maintain
compared to other means like trains and ships. It is more economical for short-haul transport.
The convenience of road transportation due to direct and accurate response and flexibility
compared to other modes of transport has led companies to favor it. The strengths as well the
9
limitations of road transportation are pointed out in the journal article of Pienaar which is
comparing it with the rail mode (Pienaar, 2003). The strengths include:

Door-to-door services

Accessibility. Providing transportation services in geographical isolated locations

Freight protection

Transit time in relation to short-haul parts

Capacity. The adaptability of carrying capacity

High frequency
On the other hand the limitations concern:

Finite loading capacity

Externalities of road mode. Noise, air pollution

Vulnerability to external factors. When the driver is exposed to difficult weather
conditions such as snow and fog

High energy consumption

Congestion
Nevertheless, as seen in Figure 2 from data taken from European Commission, road
transportation excels the other modes in levels of freight performance.
Figure 2 : Performance by mode
Source: (European Commission, 2013)
Figure 1: Performance by mode
10
2.4 Intermodal transportation
Being an option for long-haul freight transportation the researcher will proceed by providing
another definition of intermodality and its differences between this and multimodal networks.
Intermodality is used for the transportation of freight over long distances. For short-haul
transportation road solution is mostly used. The market is the one determining the difference
between short-haul and long-haul. The Ekol Logistics case will be linked subsequently to these
definitions. Since there is no common definition in the literature and after reviewing several
interpretations of the term, I find the most accurate the one provided by the European
Conference of Ministers of Transport (OECD) which defines intermodal transportation as:
“The movement of goods (in one and the same loading unit or a vehicle) by successive modes of
transport without handling of the goods themselves when changing modes” (Eurostat, 2002)
Figure 3: An example of the intermodal journey
Source: (Eurostat methodologies and working papers, 2009)
In the previous picture it is clearly portrayed an example of a transportation system in an
intermodal journey. The commodities are manufactured in a factory by a producer which
supplies the railway and are transferred by rail to an intermodal terminal represented by the
anchor. With the use of intermodal cranes the loads are transshipped to the second mode,
vessels in this case and the same procedure takes place until the end receiver, the
supermarket. According to the Illustrated Glossary for Transport Statistics (Eurostat
methodologies and working papers, 2009) intermodal is a particular type of multimodal
transportation which according to the same source is defined as: “The transport of goods by at
least two different modes of transport”. The terms one might assume can be used
interchangeably since both of them prerequisite the use of similar criteria. However there is
11
one distinct difference that separates them. In a single journey for an intermodal trip, we have
multiple carriers responsible for every part of it, with different signed contracts, while on the
multimodal trip the responsible carrier is only one. For instance, in Ekol’s case the carrier who
would take responsibility of the movement of the shipment from Turkey until Italy by sea
would differentiate from the one responsible for the rail movement from Italy until Germany.
For such an intermodal operation the carrier issues a Port to Port Bill of lading which includes
contracts between all of the parties involved (carriers and suppliers). The bill of lading is
equivalent to a receipt that specifies the value of the cargo, transportation charges, and
clarifies carrier liability for every part of the trip (Mahoney, 1985). On the contrary, in a
multimodal trip only one transportation carrier is responsible for the entire trip and issues a
Combined Transport Bill of Lading (Manaadiar, 2014). In another study, Rodrigue focuses on
the efforts having been made over the last forty years to integrate the separate transport
systems through intermodalism (Rodrigue, 2013). He targets on the importance of viewing the
intermodal trip as a whole rather than a set of series with independent steps designated by a
specific beginning and ending. This way, we boost the economic gains by the effective use of
the combined modes. Therefore, intermodality prerequisites the interoperability between all
of the modes used in the trip. The intermodal trip is a complicated system with the
involvement of several parties from carriers and shippers to railway providers which
sometimes turn out to be governments which set their own security standards under each
country’s legislation. Nevertheless, on European level every state member of the European
Union must respect the laws by complying within the European legislation. To summarize the
goal of the intermodality is to:

“Integrate the various modes and services of transportation to improve the efficiency
of the whole distribution process” (Bektas & Crainic, 2007)
In the next passage we will discuss the significant role of containerization to an intermodal trip.
2.4.1 Transit containers
Containers are among others, key components in the intermodal trip. Containers are defined
by the European Conference of Ministers of Transport (European Conference of Ministers of
Transport, 2001) as a “generic term to carry freight, strong enough for repeated use, usually
stackable and fitted with devices for transfer between modes”. They contribute to the
unitization of the cargo for the formation of a single unit. They integrate the loads in specific
dimension boxes easier to handle and distribute. In doing so, the goods are transferred much
quicker than the transfer of every independent single unit. There are many types of transit
12
containers satisfying the need of transport depending on the nature of every shipment. The
importance of containerization is described by Mahoney (Mahoney, 1985):

They are easier to handle

Easier loading in every respectable vehicle

Better calculation because of the fewer items to count

Less lost or stolen items

Less bureaucratic proceedings

More convenient intermodal transfer
According to the International Organization for Standardization (ISO) (PrimoCargo Gmbh,
2014) the standard containers include the twenty-foot long box or also known as twenty-foot
Equivalent Unit (TEU), the forty-foot which is the most widely used one and the forty five-foot
long one. The standard sizing dimensions are described in details by the following table.
Table 1: ISO Standard Container types
20’
Standard
Container
External
Internal
Door opening
Length
Width
Height (Normal)
Height (High Cube)
6.058 mm
5.867 mm
2.438 mm
2.330 mm
2.286 mm
2.591 mm
2.350 mm
2.261 mm
2.896 mm
2.655 mm
2.566 mm
Length
Width
Height (Normal)
Height (High Cube)
12.192 mm
11.998 mm
2.438 mm
2.330 mm
2.286 mm
2.591 mm
2.350 mm
2.261 mm
2.896 mm
2.655 mm
2.566 mm
Length
13.716 mm
13.532 mm
Width
2.438 mm
2.330 mm
2.286 mm
Height (Normal)
2.896 mm
2.655 mm
2.566 mm
40’
Standard
Container
External
Internal
Door opening
45’
Standard
Container
External
Internal
Door opening
Source: (PrimoCargo Gmbh, 2014)
The material being used for the structure of a container is either steel or aluminum with the
last one being mostly used for domestic transport whereas the first one for maritime transport
13
(Bektas & Crainic, 2007). Apart from the standard containers there are also different types
satisfying more sophisticated criteria. The high cube (HC) container is similar to the previously
mentioned except from its greater height. It reaches the 2896 mm. The hard top (HT) makes it
easier to pack and unpack the commodities by a crane since it has a removable roof. In
addition, the open top has no roof and facilitates in the movement of over-height cargo. In this
type, the commodities are secured by wrapped tarpaulin around the top. Other containers
include the ventilated and refrigerated used for susceptible goods while the platform and
flatrack consist of reinforced floors special designed for high loading capacity (PrimoCargo
Gmbh, 2014).
In Ekol’s case we will delimit the research to only ISO standard intermodal containers and
trailers used for the intermodal trip. These include the one’s illustrated in Table 1. The
containers are loaded to block trains. Every block train consists of 34 containers. An intermodal
block train unlike public trains has standardized procedures, with exact departure and arrival
timetables, less bureaucratic proceedings especially with the border documentation, and exact
capacity. Additionally, block trains travel without being split up at any point of the journey.
2.4.2 Intermodal terminal
Due to economy of space the writer will not perform an in depth analysis of terminal
operations. Instead he will attempt to make a presentation of the intermodal terminal key
points to familiarize the reader with the terms related to the case study.
An intermodal terminal is a central or intermediate freight point between transportation
modes where freight is loaded or unloaded and stored until further distribution. The most
common modes used in a hub are the sea-road, sea-rail and road-rail modes even though
there can be a combination of all the above. This thesis will focus on the description of searoad and sea-rail terminals that concern our case study.
Kim et al. (Kim, Phan, & Woo, 2012), classifies the terminals in two categories depending on
the handling systems they use. The “indirect transfer system” and “direct transfer system”. On
the first case quay cranes are used for handling the shipments incoming from a barge or
containerships to transporters which from their part, move them to a storage area where the
yard cranes receive them and stuck then into piles until further distribution. Figure 4 indicates
the operational sequence.
14
Figure 4: Indirect Transfer System
Source: (Kim, Phan, & Woo, 2012)
On the other hand in “direct transfer systems” the same procedure occurs with the difference
of the shipment being transported by container chassis when it is stored in the ground until
being loaded again to trucks or trains.
Figure 5: Direct Transfer System
Source: (Kim, Phan, & Woo, 2012)
The former takes place at Ekol’s case in the port of Trieste (IT) where a specific intermodal
terminal is designed for the incoming RORO ships and the loading of their shipments directly to
trains. The terminal is designed in such a way that allows the railway lines to enter the port site
in order for the trains to be loaded there resulting to quicker service. In the case of Greece and
the ports of Thessaloniki and Lavrio the situation turns out to be vaguer but the existing
infrastructure isn’t prohibiting the implementation of direct transfer systems.
In his study about intermodal transportation Crainic (Teodor Gabriel Crainic, Chapter 8
Intermodal Transportation, 2007) describes the container yard as seen in Figure 6. This is an
illustration of an indirect transfer system following the procedure described previously with
the inclusion of outside trucks entering the system for the receiving and delivering operations.
He divides the handling operations taking place at the intermodal terminal in three categories.
The first one corresponds to the unloading and loading of the shipments from the ship as well
as its berthing to the port. The next one deals with the delivery operations of outside trucks or
trains. Lastly he includes the container handling and storage of the shipments to the yard.
15
Figure 6: The intermodal sea-road terminal
Source: (Teodor Gabriel Crainic, Chapter 8 Intermodal Transportation, 2007)
2.5 Intermodal transportation in European Union
European Union released several studies promoting intermodality advantages over other
transportation systems and more in particular road transportation. The main reasons for such
a transition are illustrated below in accordance to the executive summary published by the
commission of the European Communities (Commission of the European Communities, 1997).
1. The role of transportation will become more important due to enlargement of the
Union by new state members, especially from the Central and East European
countries. The integration of these markets to a European transport system is an
essential component in the Union’s competitiveness.
2. The outcome of the latter will be a growth on the numbers of freight to be travelled
leading to greater numbers of externality levels that affect the system such as
congestion, accidents, noise and air pollution.
3. The current solving approach described as “business as usual” towards transportation
problems needs to be altered into solving transportation systems. This way we deal
with problems comprehensively rather than individually.
4. The goal of this transition to a holistic approach is the development of a framework
that integrates all the modes to achieve a less costly, customer orientated, door-todoor service.
16
5. In order to accomplish this transition from the current setup to intermodal solutions
we have to overcome several obstacles. Infrastructure background including roads,
railway lines or sea connections between hubs and within modes has to be developed
throughout the European network. The technical interoperability including
communication lines between and within modes. For instance the development of
software for the tracking of shipments via satellite networks.
6. These efforts must be coordinated from a national, regional and European spectrum to
achieve a common transport policy.
7. Intermodal transportation is a “greener” solution compared to the externalities
derived from road transport and EU promotes the use of a more environmental
friendly ways of transport.
On the same respect European Union has introduced programs like "Motorways Of The Sea"
and C.R.E.A.M. (Ekol, 2015) (Customer-driven Rail-freight services on an European megacorridor based on Advanced business and operating Models) that promote intermodality. The
writer will not go into further details about the programs.
Having discussed the advantages of every mode the answer to the question “Which mode to
use for my shipment” is highly correlated with the nature of the commodity to be transported
and the service quality. The shipper has to take into consideration all of his alternative options
and perform a non biased analysis according to each case criterion.
17
Chapter 3
Chapter 3 depicts Ekol's overview presenting its road and intermodal operations. It is divided in
two parts the first one concerning the company as a whole and the second one its Greek branch
transportation operations. The first research question of: "How are the unimodal and
intermodal trips being implemented from theory to practice" is answered.
3.1 Company overview
Ekol Logistics is a Turkish based company providing logistics services in several European
countries. Their transportation network exceeds from Turkey all along through Europe. Their
current setup consists of over 400.000m2 closed area distribution centers in Turkey along with
facilities in Greece, Germany, Bosnia Herzegovina, Romania, Italy, France, Ukraine, Hungary
and Spain. They offer a complete set of Logistics services to its customers expanding from
transportation, warehousing and international commerce issues. In transportation field they
deal with international and domestic road solutions along with air, sea, rail or combinatorial
intermodal services. The objective is door-to-door services in competitive rates and times
compared to the competition. Their total closed warehousing areas are estimated to be at
around 425.000m2 in Turkey and additionally 100.000 m2 in the European Union where they
store bonded and non-bonded loads. They possess a fleet of over 3.000 vehicles and currently
employ 5.000 employees (Ekol, 2015). Ekol’s turnover from 2010 until 2014 suggests an
average annual growth rate of 32% as seen by the figure. It is noteworthy to mention that
64.11% of company’s services concerns international transportation which will be the area this
research will focus.
Figure 7: Turnover of Ekol Logistics
Source: Own
18
3.2 Ekol Logistics intermodal operations
In relation to the Greek case which we are about to discuss, the intermodal trip, is already
being implemented by the mother Turkish company. The writer will make a description below,
of the intermodal network the company uses for the outbound and inbound shipments
generated from Turkey and back. This network is linked with the Greek case by the
transshipment point of Lavrio (EL), which is portrayed in Figure 9, where the RORO ship makes
a stop on its way to Trieste (IT). The RORO2 ship is designed to transfer rolling stock cargo, like
trailers, trucks, trains without the use of cranes to load and unload shipments. The shipments
are directly loaded on board. We will delimit the research in only describing the journey and
not examining how the demand is generated. The use of trucking is essential on gathering the
standard ISO intermodal containers to the locations where Ekol operates in Turkey. These
include Mersin (TR) and Istanbul (TR) ports. The containers are loaded to the three privately
owned RORO ships with gross tonnage of 29.004 tones, the same for the second and 29.429
tones for the third one. The journey concludes to Trieste (IT) port which is the final destination
of the sea transportation. The lead time is 60 hours. In Trieste (IT) the standard ISO intermodal
containers are unloaded from the RORO ship by specific container chassis, operated by Mafi
GmbH, and loaded directly to Kombiverkehr GmbH Block trains without the use of trucking.
The trains enter the site of the port in order to be assembled inside the terminals.
Kombiverkehr GmbH is a German intermodal operator and partner of Ekol Logistics that
develops, organizes and markets a European network specifically designated for rail-road
transportation (Kombiverkehr GmbH, 2014). The exemplification comes in response to the
intermodal definition given in the previous chapter, which was clarifying the existence of
alternative contracts and operations under the same journey. Additionally, the existence of
various contracts between Ekol and drayage providers that unload shipments from vessels and
load them subsequently to trains, ensures on-time delivery and strengthens the former
consideration. The interval of 20 hours passes for the completion of the journey to the hub
terminals of Ludwigshafen (DE), Cologne (DE) and Ostrava (CZ). The containers are unloaded to
trucks operated by Ekol Logistics and travel until their final destination. The opposite direction
is taking place when shipments outbound from Germany or Czech Republic to Turkey. Ekol
Logistics has nowadays included Ljubljana (SL) in their network as a consolidation terminal. It is
used as a hub to serve the Balkan markets. The strategically inclusion of Ljubljana (SL) terminal
is key to the Greek side’s interest. Thus, Greece, is included to the already implementing
intermodal network by the inclusion of the Lavrio (EL) port which serves as a transshipment
2
Source: (BusinessDictionary.com - Online Business Dictionary, 2014)
19
point and Ljubljana’s (SL) terminal. In Figure 8 we have a visualization of the intermodal trip. It
clearly imprints the location of the hubs as well as the markets served. Thereby the
consolidation terminal of Cologne (DE) is used for shipments which final destination is
Northern Europe including Scandinavian markets, United Kingdom, Netherlands, Belgium and
Germany itself. The Ostrava (CZ) terminal is mostly serving shipments heading towards the
Eastern markets including the Baltic countries and Ludwigshafen's (DE) terminal for shipments
to Central and Central-West European markets.
Figure 8: Intermodal network from Turkey (without Greece's inclusion)
Source: (Ekol, 2014)
3.3 Ekol Logistics road transportation
Ekol Logistics offers road transportation services to its customers and it’s another subject this
thesis will deal with. Having been stated before, road transportation offers direct door-to-door
services tailored to the specific attributes and needs of individual customers. Ekol has
developed strong infrastructure of privately owned fleet depending on the type and the nature
of the product to be transported. It offers four types of services.
a. The standard delivery. One single driver per trip, concerns mostly non-time sensitive
cargo.
b. Express delivery. It offers multiple drivers in the same truck per trip. This service deals
with time sensitive products. The shipment can use various modes.
20
c. Super express. Again with multiple drivers, but with the use of only road
transportation.
d. Speedy delivery. Multiple drivers using smaller vehicles in terms of volume designated
for the service of specific customers.
3.4 Greek Branch
The company’s Greek branch, Ekol GR, offers three transportation alternatives to its
customers; the road solution, the Intermodal solution and the Tri-modal solution (combination
of sea, road and rail modes) under this exact naming. They will launch in the near future a
newly established intermodal trip from Greece until Germany to serve as an alternative option
to the original one, operated by the mother company. The goal is to operate a new intermodal
line that serves the outgoing demand from Greece, while taking advantage of the previously
idle Balkan markets of FYROM, Serbia and Slovenia. These markets represent a respectable
demand of freight which the Turkish company through strategic decisions would like to include
to its network. The Balkan Peninsula is represented by evolving markets which share similar
cultural characteristics exceeding from Turkey until FYROM (Macedonia) and Bosnia
Herzegovina. The company claims that under the right marketing campaign these markets
could turn out to be prosperous for them. Nevertheless, until now, the lacking infrastructure in
terms of road-rail construction, securing the shipments due to theft, accidents that cause
casualties, were prohibiting factors for big investments. The former played major role on the
non utilization of Greece’s strategic geographical position. The description of the routes has
been discussed in thorough in the previous part.
The intermodal services offered by the Greek branch are based in two pylons. They have
notionally divided Greece in two parts. Based on the demand generated, the Northern and
Southern part of the country.
In the first occasion concerning the Northern part, they use block trains with the provider
being Ekol GR for transporting to and from the Balkan and European markets. More specifically
the routes include:

Weekly trip from Thessaloniki (EL) to Skopje (MK) every Monday at 17.00 with
transfer time, 13 hours.

Weekly trip from Thessaloniki (EL) to Ljubljana (SL) every Tuesday at 17.00 with
transfer time, 60 hours.
21

An interconnection between Belgrade (SRB) and Skopje (MK) also exists where the
train departs from the former every Friday and returns to the latter every Tuesday
with transfer time of 24 hours.

During August 2014 a weekly trip from Thessaloniki (EL) to Belgrade (SRB) will be
introduced every Monday with transfer time of 48 hours.
Alternatively, for the journeys from Greece until Germany, Ekol GR uses Ljubljana’s (SL)
terminal to consolidate shipments travelling to Germany. Using Kombiverkehr GmbH provider
the journey follows the same route as described in the previous passage. In addition, Ekol GR
has recently formed a deal with another intermodal operator RCA AG (Rail Cargo Austria) for
reservation of specific number of containers to their block trains from Thessaloniki (EL) to
Sopron (HU) – Duisburg (DE) and Mannheim (DE). RCA AG operates also a line between
Ljubljana (SL) and Munich (DE) where Ekol GR has agreed on reserving spots according to
demand fluctuations for their containers. On the August 2014, the establishment of a new line
has been scheduled for the connection of Thessaloniki (EL) and Istanbul (TR) via sea. The new
lane will be served by a feeder vessel every Friday in order to serve shipments from Turkey to
the Balkan markets. Therefore the company agreed on entering the Balkan market using
intermodality alongside with road transportation that it has been used until now. Figure 9
illustrates the intermodal trips with Greece being included. The continuous red lines represent
the rail routes. Likewise, the blue dashed lines the sea trips, while the dashed red, the road
connections.
Figure 9: Alternative Intermodal journey including Greece and Balkan markets
Source: Own
22
The second pylon concerns the freight outgoing from the Southern part of Greece. The port of
Lavrio (EL) located 60 kilometers southeast to the city of Athens (EL) was chosen as the
transshipment point. As previously discussed the journey operated by the mother company,
departs from Istanbul and the port of Haydarpasa (TR) until Lavrio (EL). There are two
departures per week every Thursday and Saturday with lead time of 28 hours. From Lavrio (EL)
until Trieste (IT) the lead time is 32 hours. The inbound journey takes place twice per week
every Thursday and Saturday. All of the previous information was retrieved by Ekol’s Greek
department database.
3.4.1 The geographical role of Greece
Greece (excluding Cyprus) is the last border of European Union towards the Eastern markets.
The globalization and the Chinese industrial development forced companies to reevaluate
Logistics systems, their ongoing transportation networks, procedures and strategies. First of
all, in strategic level it forced them to include markets that were previously excluded in search
of more financial gains. The example of Cosco Pacific Limited is indicative. China Ocean
Shipping Company (Cosco), is China's largest and one of world's largest enterprises focusing on
global shipping, logistics operations and ship building and repairing (COSCO Group, 2014). In
2009 the state of Greece granted Cosco Pacific Limited to operate in the port of Piraeus (EL)
for thirty five years. Cosco Pacific Limited leased a part of the container terminal for its
operations. Their mission is to be the: "Gateway and transshipment hub in Greece,
Mediterranean and Europe" (Piraeus Container Terminal S.A., 2015). The chain reactions of
such a decision affect other European countries like the Netherlands and may change the
transportation map in the nearby future.
Indicative of the current situation, is a report released by the Netherlands Institute of
International Relations (Putten, 2014) in which they conclude the following:

The port of Piraeus is the world's fastest growing container port. Cosco's involvement
attracted other companies like Hewlett Packard, Huawei, ZTE and Samsung to consider
relocating their regional distribution centers to Greece.

The Chinese state is strengthening its influence over EU in the maritime trade corridor
with actions like that. It is a long term process that may rearrange the strategic
positions between them.

In the same respect the state of China may be heavier involved over Greece's
government policies in issues of high interest for them. The Greek economy is
23
strengthened due to the increased trade with China but on the contrary this might
lead to increased inflow of undeclared commodities.

Cosco Pacific is being listed on the Hong Kong stock exchange and on the same time
fully controlled by the Chinese Communist party. This characteristics of financial
transparency and support by the Chinese government are appealing to the Greek state
and Cosco's business partners in the port of Piraeus.

We have a transition of trade flows between China and EU via the port of Piraeus
rather than Rotterdam (NL) or Hamburg (DE).
3.4.2 The profile of Ekol Logistics customers
The profile of Ekol's customers expand from a wide set of industries. These include:

Textile and Retail industry and companies like United Colors of Benetton, Puma, Gap

FMCG (Fast moving consumer goods) like P&G (Procter and Gamble) or Henkel

Chemical companies like Evonik and General Electric

Pharmaceutical enterprises like Bayer, Pfizer or L'oreal

Automotive companies like Mercedes Benz and Honda
Of course Ekol is seeking for continuous ways to expand their current customer portfolio.
24
Chapter 4
The following chapter comes in response to answering the second and third research question.
The carrier and modal choice determinants will be discussed in details based on the relative
literature. This is the first part of this thesis main analysis.
4.1 The carrier and modal choice determinants
In his book about Purchasing and supply chain management, Monczka (Monczka R, 2002)
points out four key decision-making processes for mode choice and carrier selection. A
customer needs to:
i)
Identify the relevant transportation performance variables
ii)
Select the mode and transport carrier according to his needs
iii)
Negotiate the prices and the service levels
iv)
Evaluate carrier’s performance in the end.
Step 1: Transportation variable identification
Step 2: Carrier and Mode selection
Step 3: Price and Service level Negotiation
Step 4: Evaluation
From the writer's point of view and his literature research, it is fair to say that most of the
research work being conducted in the field so far focuses on specific attributes that a carrier
must satisfy in order to be attractive for a supplier to select him. These in a pure simplified
consideration would be the cost of the providing service, the times for the conclusion of the
service and of course the nature of the product. However, it is considered to be a rather
complex decision as the process sometimes requires the inclusion of multiple criteria which
are not easily quantified. In an attempt to review the literature involving the carrier and mode
selection the writer went through relevant journal articles. Meixell and Norbis (Meixell &
25
Norbis, 2008) categorized forty eight peer-reviewed journal papers that span in an interval of
twenty years in three parts. The attribute identification, the decision process development
and papers dealing with supply chain integration. Among others, they state that many of the
papers reviewed were motivated by the deregulation of transportation field. The public sector
was deregulated by the American government during the 1980’s with the pass of the federal
law known as the Motor Carrier Act of 1980 (Premeaux, 2002). The latter Act was a milestone
that triggered chain reactions in the transportation field. It led to companies reorganizing their
networks and establishing new management systems related in promoting their products to
their customers in a more competitive environment. They had to find the new decision criteria
that affected their customer’s choice in an altered market. This is an ongoing procedure that
lasts until nowadays.
The methodology the writer will apply is firstly detecting the key attributes that constitute
variables capable of affecting a customer’s choice on the transportation carrier it will use and
afterwards apply them in Ekol's case. That is considered to be a normative approach. This
means that according to the shipper's preferences (norms) as far as his choice criteria the
writer will assume that in the same case another shipper would take the same decision.
In the research community the topic of mode and carrier selection tends to be closely
correlated one to the other. Initially in our case the writer had already assumed that the
shipper has chosen Ekol Logistics for its transportation services. Therefore, the only part that
needed to be clarified was the transportation mode it would use from the solutions that had
already being implemented by Ekol. However, as the ongoing research proceeded it became
clearer that the mode selection could be included as a subset of the carrier selection process.
This is due to a gap the writer found of limited theoretical sources purely describing the mode
independently of the carrier selection. After discussing with Mr. Batakis the manager of Ekol
GR we concluded that it would be of company’s best interest as well as the thesis to focus
mainly on the area of carrier selection. This way the research would provide a more
integrating approach treating mode selection as part of the carrier selection. Subsequently,
the researcher will identify the features of every product that needs to be transported and
whether the nature of the cargo is influencing the customer’s choice. The two points are part
of the four decision-making processes on Monczka’s (Monczka R, 2002) consideration. The
following two points will not be a part of an in depth analysis due to lack of information but
instead a description of the status quo from the carrier’s point of view in the case of Ekol
Logistics.
26
4.2 Identifying the Key Attributes for selecting a carrier
As being presented by Coulter et al. (Coulter, Darden, Coulter, & Brown, 1989), the variables of
carrier’s choice are being presented on the table below being enriched with one additional
attribute, the CO2 levels, as companies nowadays seem to be taking into consideration the
environmental factor. The following seems to be a generic table but nonetheless represents
the vast majority of the shipper’s decision making characteristics. The writers divided them
into five broader categories named under the Discriminant Factor column.
Table 2: Aggregated Carrier selection attributes
Attribute
Discriminant Factor
1. Reliable transit time
Reliability of performance
2. Reliable pickup service
3. Speed of transit time (shipper to receiver)
4. Cost (rates)
5. Claims service
Insurance of service provision
6. Billing service
7. Loss/Damage history
8. Financial stability of carrier
9. Carrier’s coverage
10. Quality of customer services
Quality of services
11. Quality of sales personnel
12. Completeness of service (range)
13. International distribution/consolidation services
14. Pricing flexibility
Personalizing factor
15. Familiarity with carrier
16. Quality of drivers
17. Quality of dispatchers
18. Carrier reputation
19. Loading and unloading facilities
Handling services
20. Handling capabilities
21. Domestic distribution/consolidation services
22. CO2 levels
Environmental concerns
Source: (Coulter, Darden, Coulter, & Brown, 1989)
27
4.2.1 Difference in perceptions in theoretical context
The first point that the research needs to clarify is whether the shipper and the carrier share
the same opinion on transportation performance attributes. In a research conducted at 1991,
Abshire & Premeaux (Abshire & Premeaux, 1991) formed a questionnaire based on a random
sample of motor carrier sales managers as well as traffic managers which findings would be
whether their perception altered because of the changing deregulated environment.
Subsequently, both carrier and shipper were included in the survey. The outcome of the
questionnaire was that there are important ranking differences in perceptions at nineteen out
of thirty five selection criteria. Later on, Premeaux (Premeaux, 2002) returned on the same
subject to view any alterations of carrier’s and shipper’s perceptions after a decade. Using a
similar methodology as before, he conducted a longitudinal analysis. The findings were that
after more than a decade shippers: “Were even more concerned with certain selection
variables than they were in 1991. Specifically, information access, consistent carrier
performance, solid customer relations, and the availability of certain desired services are even
more important now.” Moreover, Premeaux emphasizes that carriers realized the importance
of better information lines between them and the shippers in order to better understand
shipper’s priorities. Nowadays, with the assistance of technology, shippers develop more
accurate and direct communication lines than the previous years. Nevertheless, uncertainty in
the expectations is leading to gaps in perceptions with unknown results. These gaps are always
factors one researcher shouldn’t neglect and thus further investigate. For this reason several
tools have been developed to deteriorate the misinterpretation between the expectations of a
shipper, about the service transportation performance, and the service he finally gets from a
carrier.
Firstly we need to distinguish between the qualitative and the quantitative criteria. The ones
that are easily quantified such as the costs and times and the ones that are more complicated
like service quality. There are several methods. The quantitative criteria are based solely on
numbers which should be straightforward without hidden costs. The times on the other side,
are also easily quantified and can be arranged with signing contracts between the two parts.
What is more complicated is the determination of qualitative factors and how important are to
the decision of the shipper. Coulter et al. (Coulter, Darden, Coulter, & Brown, 1989), suggests
that academically the process of selecting a carrier is a two-stage hierarchical decision. Initially,
the shipper selects the mode of transportation for its shipment followed by the selection of
the carrier. He continues by stating that researches prior to his, were employing mathematical
and behavioral models for providing a solid argumentation of the selection of the modes.
28
4.2.2 Relationships between shipper and carrier
In Cunningham (Cunningham, 1982) factors such as: i) The incurring costs from the competitive
modes, ii) The predispositions of the shipper against the mode of carriage and the
interpersonal relationships with the carrier and iii) The total incurring transportation and
external costs, where the criteria that affected the shipper’s final decision.
It is evident that the qualitative criteria are based over the formation of relationships between
the shipper and the carrier. This may lead to biased decisions. These relationships formed, are
the field of research for Gibson et al. (Gibson, Sink, & Mundy, 1993). In his paper he focuses on
decision making between the shippers that choose transportation for their freight with short
term cost sensitive criteria and the others choosing based on a long term, building stronger
relationships with the carrier. The result of his model is that based on the relationships
between the two parts, different selection criteria apply in every instance. Furthermore, he
outlines that shippers realized that in order to achieve improvement performances in cost and
quality they had to alter their perspectives. They had to view transportation not from a
competitive price based scope, which provided little space for improvement, but rather from a
more integrative approach forming long term alliances with the carriers. This way they would
enjoy broader logistics services and better teamwork than only transportation.
Being a part of a team provides stability, interdependent profitability and in the end survival.
The below Figure 10 depicts the differences between a transaction based philosophy and a
relationship based. In between these two extremes, explanations are being made on which
areas every shipper focuses. These stages include companies focusing exclusively on price for
every shipment, which requires a selection from a wide set of carriers. The next category is the
carrier reduction focusing, where shippers understand that choosing a particular carrier would
lead to cost reductions by freight discounts for instance. The transitional focus aims to satisfy a
set of qualitative criteria while still achieving the minimum cost for the service. On
measurement focus a shipper is basing his selection on a previously set objective and through a
program based activity. And in the last category of continuous improvement, the carrier
becomes an integral part of shipper's transportation strategy and expects from him to
continuously improve his performance (Korpela & Tuominen, 1994).
29
Figure 10 : Transaction vs Relationship based Philosophy
Source: (Gibson, Sink, & Mundy, 1993)
In addition to the former, Gibson et al. (Gibson, Rutner, & Keller, 2002), in 2002 conducted a
second study in which they were investigating the similarities and the differences of shippers
and carriers in benchmarking factors and satisfaction levels. They investigated both shippers
and carriers. The summarize of the findings indicate that the most important partnership
factors from a shipper point of view were the cost, effectiveness, trust, flexibility while for
carriers trust was the first factor followed by effectiveness, flexibility and cost. The
differentiation in perceptions is indicating contrasting priorities.
Table 3: Partnership importance
Rankings according to
Shipper Factors
Carrier Factors
1
Cost
Trust
2
Effectiveness
Effectiveness
3
Trust
Flexibility
4
Flexibility
Cost
partnership Importance
Source: (Gibson, Rutner, & Keller, 2002)
Murphy and Farris (Murphy & Farris, 1993) introduce a time-based strategy in their research.
In an attempt to describe the three primary goals of a time-based strategy they mention that
its goals are: i) more accurate customer service, ii) expansion of the product lines with better
variability while achieving low-cost flexibility and iii) increase in innovation. Having been
determined as an innovative approach, the writers needed to adjust their research with the
current trend in order to view any alterations in the transportation choice. They additionally
linked it with JIT production and inventory systems which were viewed as desirable policies out
coming from customers and shippers. A significant attention was given to time concerning
factors that would affect the carrier selection. They outline timeliness and reliability as critical
30
decision factors. More in particular, the on-time pickup and delivery, as well as, the total
transit time.
4.2.3 Shipper perception determinants of modal choice
The perception of a transportation mode is mostly based on personal experiences from the
past, common knowledge and the expectations build. It also depends on carrier’s advertising,
the modal image as well as misinformation (Evers, Harper, & Needham, The determinants of
shipper perceptions of modes, 1996). Therefore, the decision process is turning to be a
somewhat biased procedure that even though should take into account the numerical logic, it
occasionally decides to defy it. The carriers need to have accurate perceptions of shippers’
preferences to set their goals as far as customer satisfaction is concerned. Evers et al. (Evers,
Harper, & Needham, The determinants of shipper perceptions of modes, 1996), is pointing out
that most of the carriers focus on the actual level of service provided, when they should rather
be focusing on the level of service perceived by the shippers. Thus carriers should portray their
set of services provided in accurate, explicit and comprehensive ways aiming to match these
perceptions. The findings of the survey by Evers et al., (Evers, Harper, & Needham, The
determinants of shipper perceptions of modes, 1996) present the key perception factors that
carriers should aim their marketing and operating efforts in understanding their customers’
perception. The research included 3 modes of transportation; intermodal, rail-road and road
transportation.
Table 4: Relative Importance of Individual Factors to Overall Perception for Each Mode
Ranking
Intermodal
Rail-Road
Truck
1
Availability
Timeliness
Timeliness
2
Timeliness
Availability
Availability
3
Firm Contact
Restitution
Firm Contact
4
Cost
Suitability
Suitability
5
Restitution
Firm Contact
Restitution
6
Suitability
Cost
Cost
Source: (Evers, Harper, & Needham, The determinants of shipper perceptions of modes, 1996)
The capacity issue viewed as availability in Table 4 is of major importance to the shippers in the
three evaluating categories. It pertains to the importance given to the satisfaction of the
demand. On the other hand timeliness is considered as critical factor, ranking first on rail-road
31
and road transportation modes and second on intermodal. The general result excluded is that
customers seek abundance of alternative options while avoiding risks on their supply chains.
On the same time rates are viewed as secondary issues comparing to overall secure and
reliable transportation. The former research was extended by an additional concerning
performance perceptions, satisfaction and intention from an intermodal shipper’s perspective
(Evers & Johnson, Performance perceptions, satisfaction, and intention: The intermodal
shipper's perspective, 2000). The writers explicitly clarify that the survey conducted is related
to practitioners i.e., to intermodal railroad customers. In this, they connect the current levels
of satisfaction to the future continuation of using the same mode. Moreover, they state that
the shipper’s better understanding of the services provided, is leading to more satisfactory
service levels. The following consideration prerequisites the development of better
communication streams between customer and carrier. The writers in conclusion outlined the
key factors that affect a shipper’s decision over the continuation of using an intermodal carrier
were: i) Communication, ii) transit times, iii) consistent delivery, iv) quality of customer
service and v) competitive rates.
Table 5: Factors determining the continuation of intermodal partnership
Ranking
Factors over the continuation of the
intermodal partnership
1
Communication
2
Transit Times
3
Consistent Delivery
4
Quality of Customer Service
5
Competitive Rates
Source: (Evers & Johnson, Performance perceptions, satisfaction, and intention: The intermodal
shipper's perspective, 2000)
4.2.4 Key differences in attributes in international setup
The increasing phenomenon of globalization is close connected to international transportation.
In international setup the selection variables may differ. Taking into consideration that the
system is more complicated as it requires the cooperation of additional parts, the features of
transportation present substantially alterations to domestic shipping. In Semeijn (Semeijn,
1995), the conducted survey classified the decision variables in ten groups. Based on the
importance applied for every attribute a table was constructed with the aggregated findings.
32
The shippers and carriers were asked jointly to reply on a Likert3 survey scaling from 1 for not
very important to 7 for very important. International ocean and air carriers including Maersk
(part of A.P. Moeller Group), Mitsui O.S.K. lines or American Airlines were taking part in the
survey among others. The shippers asked, were companies exceeding from a wide set of
business industries including automotive, chemicals, electronics, food and others. In an
international setting, both shippers and carriers ranked reliability first. Secondarily in
importance for shippers was the transit time, and the cost attribute came third. Unlike
shippers, carriers ranked cost as the second and transit time came in third, as the most
important variable.
Table 6: Ranking in international setup
Ranking In International
Setup according to Variable
Shipper
Carrier
1
Reliability
Reliability
2
Transit Time
Cost (Freight Rate)
3
Cost (Freight Rate)
Transit Time
4
Over/ Short/ Damaged
Over/ Short/ Damaged
5
Carrier Considerations
Carrier Considerations
6
Forwarding Services
Forwarding Services
7
Shipper Considerations
Shipper Considerations
8
Electronic Data Interchange
Electronic Data Interchange
9
Warehousing Facilities
Warehousing Facilities
10
Distribution Services
Distribution Services
of Importance
Source: (Semeijn, 1995)
Significant differences were observed in three out of ten categories namely for transit time,
carrier considerations and distribution services. It seems that shippers value more the transit
time and carrier considerations (Financial stability, quality of personnel, reputation, familiarity
with carrier) than carriers, something shown in the mean values of their replies. Unlike the
former, the distribution services are higher in carrier ratings than shippers. The findings show
3
The Likert scale is a method of ascribing quantitative value to qualitative data, to make it amenable to
statistical analysis. A numerical value is assigned to each potential choice and a mean figure for all the
responses is computed at the end of the evaluation survey.
Source: (BusinessDictionary.com - Online Business Dictionary, 2014)
33
that in international shipping the system is more complex with greater bureaucratic
procedures. That is due to the involvement of external parties like freight forwarders which
makes the modal choice a rather restricted option (Meixell & Norbis, 2008).
4.2.5 Does the size matter?
Following the survey for service priorities in international logistics, Pearson and Semeijn
(Pearson & Semeijn, 1999) extended it to single out the decision criteria of small and larger
firms engaged to international logistics. The companies that employed 500 or less employees
were considered to be small. The service variables, chosen by both small and big firms to be
the most important, were again reliability, transit time and cost. As pointed out, despite
minor differences, the variables chosen to be of most importance did not vary considerably
between the two company types.
Furthermore, Kent and Parker (Kent & Parker, 1999) focus on the international containership
mode of transport, explicitly pointing out that most of the previous researches were dealing
with the truckload mode. In their research they included import and export shippers as well as
international containership carriers. The conducted research was a questionnaire using a Likert
scale analysis anchored from one to five with one being the most important. It broadened the
literature in a way that evaluated the eighteen selected factors in three dimensions, the
export-import shipper and carrier. Moreover, using multivariate analysis techniques known as
MANOVA (multivariate analysis of variance) compared the rankings with considerable
differences in perceptions of the identified key attributes. The key shipper identified attributes
for the selection of a carrier in aggregating results for both import and export shippers were
the next in the exact order: reliability, equipment availability, service frequency, rate
changes, operating personnel, transit time, financial stability, loss and damage, expediting,
tracing, service changes, rates, scheduling flexibility, carrier salesmanship, line-haul services,
special equipment, pickup and distribution and lastly claims. The fact that rates are ranked so
low is indicative of how much more important is the reliability in services rather than the cost
itself especially in an international environment where threats and uncertainty are multiplied
than in domestic. However, the MANOVA analysis showed that import shippers ranked the
importance of rates much higher with a mean response of 1.74 than the score of export
shipper group which was 2.75. Additionally the findings regarding carrier perspectives revealed
that carriers show better understanding to import shipper criteria than the export.
34
Table 7: Key attributes for Carrier selection on both import and export shippers
Ranking
Variable
1
Reliability
2
Equipment Availability
3
Service Frequency
4
Rate changes
5
Operating personnel
6
Transit Time
7
Financial Stability
8
Loss and Damage
9
Expediting (Flexibility)
10
Tracing
11
Service Charges
12
Rates
13
Scheduling Flexibility
14
Carrier Salesmanship
15
Line-Haul services
16
Special Equipment
17
Pickup and Distribution
18
Claims
Source: (Kent & Parker, 1999)
4.2.6 The Environmental Factor
In macro level the EU legislation is currently becoming stricter in order to promote more
environmental friendly transportation solutions. The outcome may cause a chain reaction
leading companies in reevaluating their whole logistics operation performance. In the light of
these changes, companies who are involved in the field may need to alter their selection
criteria and add the variable of “Environmental Impact” to their decision making process. The
new trend in customer’s preferences affects transportation options with carriers seeking for
proven ways to offer more environmental friendly alternatives. First of all, they need to define
in which way a more environmental friendly alternative is calculated. In most of the cases the
calculation of the CO2 emissions is the decisive factor. In a research about modal shift in
nineteen European routes from unimodal to intermodal the findings showed that CO2
35
emissions were decreased by 20-25 percent (IFEU, 2009). The previous supports the assertion
that transition from road haulage to intermodal will prove to be a “greener” solution.
However, it is still unclear whether these measures are proven to be efficient enough in
altering perspectives. The shipper’s transition in selecting a different transportation mode than
the status quo is grouped into three contextual factors according to Eng-Larsson and Kohn
(Eng-Larsson & Kohn, 2012) :

External pressure

Business Strategy/policies

Logistics Strategy
The external pressure might be translated into stricter legislation as previously mentioned,
change in customer awareness demanding “greener” solutions and increased fuel prices
(Flodén, 2007).
From Figure 11 we observe that environmental friendly factors which are a part of the initial
contextual factors constitute incentives for modal shift. Moreover Eng-Larsson and Kohn (EngLarsson & Kohn, 2012) view these changes from a more generic spectrum analyzing the
consequences that a modal shift would cause. They underline that the modal shift results to
contextual factors that transpose intermodal transfer quality. In the end, through operational
changes an alteration of the whole logistics performance is observed.
Figure 11: Consequences of a Modal Shift
Source: (Eng-Larsson & Kohn, 2012)
More explicitly, when referring to a change in intermodal transport quality, elements such as
reliability, speed and order visibility are pointed out. The contextual factors chosen by
Storhagen et al., (Storhagen, Bärthel, & Bark, 2008) that might decrease the transport quality,
caused by a modal shift, would be; the product characteristics, the flow volumes and the flow
geography. The product characteristics regard the physical characteristics of the commodity
(weight, size, value, life cycle etc.). In the same respect the flow volumes, concerning the size
36
of the shipment and finally the flow geography, which are the locations from the departing
until the destination point. It is also pointed out that modal shift will cause operational
changes and more in particular, inventory levels might need to be reevaluated due to the
difference in the two modes.
4.3 Criticism of the Scoring Attributes
The importance of the mean scoring attributes is undeniably an indispensable tool for
comprehending carriers and shippers perceptions. Then again Murphy et al. (Murphy, Daley, &
Hall, 1997), criticize the former by indicating that large sample sizes with small mean score
differences can turn out to be statistically significant for the evaluation of the research. This
will reveal a high degree of difference between the two parts. The second point in their
consideration is that the within-group benchmarking of the key attributes of either shippers or
carriers differ from the overall aggregated rankings of both groups. In the performed research
though, their first consideration proved to be right while the second was wrong. Within-group
benchmarking turned out to be of high similarity. Additionally, their survey, which tested
eighteen attributes revealed a high level of difference in perceptions in two attributes.
Indicatory of the latter were the rates that ranked eighth by shippers and on the contrary
fourteenth by carriers and the negotiated service that were ranked thirteenth by shippers and
seventh by carriers.
37
Chapter 5
The purpose of this chapter is to describe and evaluate existing models from the literature in
order to develop a decision process that suggests a transportation solution to potential
customers of Ekol Logistics. Furthermore, a validation tool for decision making processes will be
presented.
5.1 The Decision Making Process for Carrier and Mode selection
The decision process is a subsequent result after a shipper has determined the key
performance attributes to be reviewed. The shippers may use mathematical models to
quantify quantitative criteria such as rates or times. The former are measurable criteria. On
the other hand, they have to implement methods for the quantification of qualitative
attributes so that they could include them as well in their consideration. According to Meixel
and Robis (Meixell & Norbis, 2008) the body of research, in a literature review conducted in
2008, doesn’t provide much “normative decision models to aid in either stand-alone
transportation choice decision-making, or integrative decision processes”. However researches
like McGinnis (McGinnis, 1989), Bagchi (Bagchi, 1989), Liberatore et al., (Liberatore & Miller,
1995) or Min (Min, 1998) all provide normative models dealing with transport choice decision
processes. The two choices of selecting the appropriate carrier and mode of transportation are
part of a multi-attribute problem. In this section we will deal with the decision process of
selecting a particular mode and carrier of transportation. In order to gain a more diverse
insight of the decision processes, at first the writer will present the existing models taken from
the conducted literature review and in the next chapter focus on the MCDM models. The
definition of MCDM analysis problem is provided by the International Society of Multiple
Criteria Decision Making (Ruiz, 2014) as:
“The study of methods and procedures by which concerns about multiple conflicting criteria can
be formally incorporated into management planning process”
Moreover: “The Multiple criteria decision analysis (MCDA) is an advanced field of operations
research and management science, devoted to the development of decision support tools
methodologies to address complex decision problems involving multiple criteria goals or
objectives of conflicting nature.” (Financial Times)
The choice of the right transportation mode and carrier according to specific needs is a
complicated procedure. It is highly connected with the individual needs of every shipper. The
contextual factors discussed in the environmental passage, determine in most of the cases the
38
choice of the mode. Viewing the freight transportation from a more generic spectrum may
lead to simplified but accurate outcomes. For instance, when a company designs its logistics
structural operations, concepts like lean versus agile manufacturing strategies play a big role in
the transportation modal decision. A lean manufacturing company, that is targeting in ways to
eliminate relative costs other than direct charges to a customer, will obviously acquire a
different transportation approach than a low cost manufacturing company that is seeking for
the advantage of economies of scale. The managers have to take into consideration conflicting
attributes. Usually the least expensive option isn’t always the one with the best service quality.
It might be that the least expensive option includes risks. Managers have to evaluate the
conflicting criteria and have access to related data prior of taking their decision.
5.2 Transportation Choice Models
5.2.1 Economic Model Determinants
Until 1989, four models for the evaluation of transportation choice were reported in the
literature:

The classical economic model

The Inventory-theoretic model

The trade-off model

Constrained optimization model
Nevertheless, the lack of a comparison between them as well as a coherent connection to the
freight transportation choice led McGinnis (McGinnis, 1989) to perform a thorough analysis of
the former in his research. The below passage is based on his study.
5.2.2 The classical economic model
The classical economic model provides us with an accurate argumentation over the mode
selection. In doing so it estimates that after a specific distance point denoted by d1 it is not
economic viable for a shipper to choose mode 1 anymore. In this paradigm shown in Figure 12,
the mode 1 is considered to be road and mode 2 rail, a fitting portrayal of Ekol’s case. The
calculated costs are consisting of fixed and variable costs. The service advantage of mode 1 is
accumulated to the freight rate of mode 2 to compound a rising cost denoted by the new
upward line. This results to a new increasing break-even distance at point d2 after which the
combination of mode 1 and 2 becomes again dominant.
39
Figure 12: The Classical Economic Model
Source: (McGinnis, 1989)
5.2.3 The Inventory-Theoretic Problem
The cost calculation is one of the most decisive factors for transportation choice. At Sheffi et
al., (Sheffi, Eskandari, & Koutsopoulos, 1988) the freight transportation charges are part of
Total Logistics Cost (TLC) that also includes the inventory carrying costs. The former consists of:
Total Logistics Cost per Item = Transportation Costs + Inventory Costs (Stationary Inventory
Costs + In-Transit Inventory costs).
The capacity constraint also is pointed out in this research. According to the EOQ (Economic
Order Quantity) analysis the shipper’s batch size optimal quantity should be at the X* point of
Figure 13. Due to constrained capacity of the vehicle in both road and railroad transportation
the optimal batch size might not be feasible.
40
Figure 13:Inventory-Theoretic Problem
Source: (Sheffi, Eskandari, & Koutsopoulos, 1988)p.143
The EOQ expression altered due to the tradeoff between the transportation costs (TC) and the
inventory carrying costs will give us the optimal X* size (Optimal shipment size) and is
calculated by the following expression:
X*=
Where
TC= Transportation Costs
SIV= Stationary Inventory Costs
INC= In-transit Inventory Costs
5.2.4 The Trade-Off Model
According to Roberts (Roberts, 1970) the freight cost is consisted of transportation (TC) and
non transportation costs (NTC). In his trade-off model he argues in a simplified consideration
that the point where a shipper is indifferent of choosing one mode in particular over another is
when:
TC1 + NTC1 = TC2 + NTC2
In addition, he underlines that non transportation costs are variables that can be easier
reduced once properly denoted. Another viewpoint suggests that, the key in transportation
choice is the balance between transportation costs and the provided customer service
41
(Mentzer, Min, & Bobbit, 2004). The customer service could be expressed as transferring lead
times, reliability and security of the shipment, among others, denoted as the service quality.
Some studies suggest that intermodal transportation is less expensive but on the other hand
slower and not as much reliable compared to road solutions (Evers, Harper, & Needham, The
determinants of shipper perceptions of modes, 1996). Thus, it can be argued that the two
transportation options form a trade-off. The usage of intermodal transportation will lead a
company to simultaneously higher its safety stock levels (and hence increasing the inventory
costs) in order to maintain competitive service quality, while achieving better transportation
rates. On the contrary, a company choosing road transportation will keep lower inventory
levels that keep up with the accurate provided transfer.
5.2.5 The Constrained Optimization Model
The choice of mode’s transportation cost (TC) subjected to several non-transportation cost
(NTC) constraints is considered to be the most reliable calculation method of all the former.
This is due to the fact that it offers a more in depth analysis of the various variables which may
be either qualitative or quantitative, either present or absent and in conclusion subjected to
trade off or constraining (McGinnis, 1989). These variables differ and are unique in every mode
decision process which makes constrained optimization model better adaptable to a wider
range of decision-making situations. The goal in most of the cases of the model is to minimize
the transportation rates subjected to; particular product, distribution pattern and service need
constraints.
5.3 The Inductive Modeling Approach. A validation tool for Decision
Making processes
The decision making process is affiliated to psychological frameworks which depend on
personal perspectives and thus may lead to biases in choosing a specific mode or carrier over
another. The individuals that take the final decision have developed their personalities
according to different experiences and personal preferences. However, the models deployed
to investigate their choice criteria are reflecting the personal rational frameworks of the
modeler that incorporate his viewpoints on the examining case. The tendency to conceptualize
processes and models in specific logical categories, is leading to the assumption that the
decision making process is a rather rational procedure. Pishadori (Pisharodi, 1991) is referring
to this phenomenon as anthropomorphism. For instance a carrier selects a “rational” decision
making model to adjust it to his needs. The carrier provides to his customer specific
transportation options, with specific information about them, whenever he chooses following
42
a general rule of thumb or according to his own personal beliefs. Even though the customer’s
needs might suggest for a different approach, the carrier adjusts them according to the
existent model. According to Pishadori (Pisharodi, 1991) this kind of approach may lead to
costly mistakes. Subsequently, an inductive analysis of the decision making framework is
considered to be essential in order to codify personal rules into theoretical models. The scripttheoretic approach was firstly introduced by Leigh and Rethans (Leigh & Rethans, 1984). In the
research taking place, several case scenarios or scripts were gathered by industrial customers.
The majority of the findings was mostly descriptive and provided empirical evidence of
industrial purchasing processes that helped developing script norms. The subsequent script
validation results, show that the developed scripts were accurate valid representations of the
customers’ buying processes (Leigh & Rethans, 1984). The model follows the latter sequence:
Figure 14: Script-theoretic model
Source: (Pisharodi, 1991)
The model contains five steps. Firstly an interpretation of the various characteristics of the
decision-maker and hence its needs should be evaluated. In addition, the script elicitation and
integration takes place where the model is developed from the incoming responses. The third
step is validating the stability and the accuracy of the script. Thereafter the script is due to
quantitative and qualitative analysis which clarifies the relationship between several scripts,
between the events taking place in the particular script and finally between the decision
variables. The last step regards the application of the model (Pisharodi, 1991).
In conclusion the writer has to clarify that the script-theoretic approach does not present a
decision-making proposal for mode or carrier transportation since it is oriented in describing
decision processes. In contrast the model provides insights about the accurate effectiveness of
the decision processes being followed.
43
Chapter 6
The aim of the following chapter is to answer the last research question by developing a Multi
Criteria Decision Making tool for Ekol Logistics. More precisely it will focus on the development
of an Analytical Hierarchy Process (AHP) tailored for the needs of our fictional scenario.
6.1 The MCDM Models for Carrier Selection
Introduction
The need of a MCDM analysis becomes apparent in carrier selection since it sets weights to the
various decision making criteria. Consider a carrier providing cheap rates for transportation
services and lacking reliability in fulfilling the service on the upon agreement time intervals. In
contrast, a carrier with the best quality services but unacceptable rates. By setting weights on
the attributes a shipper can better identify its needs and take a substantial decision.
In the previous chapter, we have identified these criteria and divided them in different
categories. Therefore, depending on the size of the shipper, it's international or domestic
interest, the interrelationships formed with the carrier or the environmental concerns we have
categorized the carrier selection criteria. Subsequently, we determined the mode selection
criteria of three categories; the road, rail-road and intermodal solutions. In the researches
previously mentioned the writers have already set rankings in the key attributes using a set of
variety techniques, in most of the cases questionnaires. However, in this chapter we will
demonstrate how these attributes are ranked using MCDM techniques that set weights on
them.
The literature review that the author conducted provided with consistent information about
MCDM models despite the fact that these are correlated with supplier selection. Non pure
carrier selection MCDM models were found. Nevertheless, the researcher will modify them to
fit the carrier selection criteria. The evaluating tool will be tailored to Ekol’s customers and
provide the company with insights about how their shippers select a carrier.
As previously stated the purpose of the MCDM techniques is the evaluation of the different
alternatives and choice of the best available. In their article, Trehan et al. (Trehan, Sharma, &
Ambedkar, 2012), describe the procedure in three steps:
44
Step 1:
Identification of the
decision hierarchy
having criteria.
Step 2:
Step 3:
Determination of the
relative weights of
the criteria of the
hierarchy.
Comparison of the
various alternatives
and ranking them in
order of preference.
The former represents a general rule. Subsequently we will focus in the relative to our case
models. The choice of them is based according to popularity and relativity to Ekol's case.
6.2 Literature review
The lack of transportation carrier selection literature reviews led to the research being
narrowed to supplier selection. The writer used these reviews to retrieve data for the MCDM
techniques. Three recent reviews including Agarwal et al. (Agarwal, Sahai, Mishra, Bag, &
Singh, 2011), Ho et al. (Ho, Xu, & Dei, 2010) and Chai et al. (Chai, Liu, & Ngai, 2013) were found
in order to assist in the formation of the tool. In the first two reviews, which solely focus on
MCDM models, the same techniques were used with minor different rankings in popularity of
the approaches. In the third one the authors viewed from a broader perspective and
underlined the lack of a systematic literature review on supplier decision making. Taken from
123 articles, Chai et al. clustered in three categories the decision making techniques according
to decision making perspective. These include the following:

Multi-attribute decision making (MCDM) techniques

Mathematical programming (MP) techniques

Artificial intelligence (AI) techniques
In addition, in the latter review Data Envelopment Analysis (DEA) is under the Mathematical
programming category, Analytical Hierarchy Process (AHP) under the Multi-attribute decision
making category and Case Based reasoning (CBR) falls into the Artificial intelligence category.
This is a more systematic classification of the decision making techniques coming in
contradiction to the first two. The researcher will focus on the first two reviews though, due to
the inclusion of only MCDM techniques which are the subject of this chapter. Of course, the
findings of the third review will be discussed. More analytically, according to Ho et al. (Ho, Xu,
& Dei, 2010), the rankings according to popularity of the methods include the following:
45
Table 8: The MCDM techniques according to popularity
Ranking based
MCDM Technique
on Popularity
Percentage of
popularity
1
Data envelopment analysis (DEA)
17.95%
2
Mathematical Programming Models (MP)
11.54%
3
Analytical Hierarchy Process (AHP)
8.97%
4
Case Based Reasoning (CBR)
8.97%
5
Analytical Network Process (ANP)
3.85%
6
Fuzzy Set Theory
3.85%
7
Simple multi-attribute rating technique (SMART)
2.56%
8
Genetic Algorithm (GA)
1.28%
Source: (Ho, Xu, & Dei, 2010)
The following table represents the outcome of the Ho et al. review. In the Agarwal et al.
review, the Fuzzy Set Theory was ranked on the fifth position and Analytical Network Process
on sixth. Additionally, Agarwal et al. (Agarwal, Sahai, Mishra, Bag, & Singh, 2011) includes a
ninth method under Criteria Based Decision Making Methods. The writer choose to focus on
the Ho et al. study because of the amplitude of the research articles the review deals with 78,
over 68 at Agarwal et al. In the third column of the table Ho et al. depicts the percentages of
popularity. Thereafter one might assume that the sum isn't 100%. The rest concerns integrated
approaches, a combination of two or more MCDM techniques used to solve a problem.
The findings of the third survey present somehow alternative results. In contrast with the
former two reviews in Chai et al. they further categorize the decision making models for
supplier selection and exclude different results. In relation to the DEA technique which is the
most common on Agarwal et al. and Ho et al., in Chai et al. it gathers 10.57% and is on the
third place. Another interesting fact lies on the Analytical Hierarchy process (AHP) technique
being the most common one used with 24.39% in the 123 articles. The second most popular is
the Linear Programming (LP) with 15.44%.
In the next part the writer will present DEA and AHP techniques which finds appropriate to fit
in Ekol's case.
46
6.2.1 Data Envelopment Analysis (DEA)
DEA is a technique which measures the relative efficiency of a system. As Kao (Kao, 2014)
points out :"Data Envelopment Analysis (DEA) has been widely recognized as an effective
technique for measuring the relative efficiency of a set of decision making units (DMU's) that
apply multiple inputs to produce multiple outputs". By doing so, it accumulates the weighted
sum of benefits tagged as the output of the system, divided by the weighted sum of costs for
the offered services tagged as the input. The weighted sum of the output may include; the
performance of the delivery, the communication lines, the security and all the features having
been described as key attributes by the customer. The quotient of the fraction will classify the
transportation services as being efficient or inefficient (Agarwal, Sahai, Mishra, Bag, & Singh,
2011).
DEA:
= Efficiency
Furthermore, Agarwal et al. (Agarwal, Sahai, Mishra, Bag, & Singh, 2011) form a table where
the classified suppliers (in our case the carriers) are categorized into four quadrants according
to efficiency and overall performance. This way results are easier benchmarked and assist to
the elimination of the least desired companies.
Efficiency
Performance High Performance and High Efficiency
High Performance and Low Efficiency
Low Performance and High Efficiency
Low Performance and Low Efficiency
Source: (Agarwal, Sahai, Mishra, Bag, & Singh, 2011)
6.2.2 Analytical Hierarchy Process (AHP)
The Analytical Hierarchy process is a MCDM technique that combines both qualitative and
quantitative criteria. Many of the selection criteria that companies choose in order to take
their final decision are intangible, meaning that they can't be easily quantified. AHP is the
theory of measurement using pair wise comparisons between the intangible and tangible
attributes (Trehan, Sharma, & Ambedkar, 2012). According to Saaty (Saaty, 1983), :"It is a
method we can use to integrate our perceptions and purposes into an overall synthesis. The
AHP does not require that judgments be consistent or even transitive. The degree of
consistency (or inconsistency) of the judgments is revealed at the end of the AHP process". The
advantage of the AHP seems to be the ease of integration of incommensurable as well as
47
quantifiable attributes into one decision making framework. As Saaty mentions, these
attributes doesn't have to be consistent. Therefore, AHP is a versatile method because of the
volume of the criterions it can contain, allowing diverse attributes to be quantified into a
unique comparative technique. The whole procedure is divided into seven steps based on the
principles of decomposition, comparative judgments and synthesis of priorities (Saaty, 1983).
In their article Vaidya and Kumar (Vaidya & Kumar, 2006) provide the following structuring
AHP methodology:
Step 1: Problem statement
Step 2: Identify the objectives of the problem taking into consideration all of the aspects of the
actors, objectives as well as setting the expected outcome
Step 3: Identify the criteria that influence the behavior
Step 4: Structuring of the problem into a hierarchy of different levels. On the first level the
goal is set followed by the criteria, the sub-criteria and their alternatives
Step 5: Comparison of each element in every level to calibrate them in a numerical scale
Step 6: Identification of the maximum Eigen value, consistency index CI, consistency ratio CR,
and normalized values for each criterion-alternative
Step 7: In case the maximum Eigen value, CI and CR are satisfactory then decision is taken on
the normalized values, otherwise we repeat the procedure until we reach the desired level
6.3 Ekol's case
In Ekol's case, the attributes concerning carrier selection from a supplier's point of view are in
most of the cases both qualitative and quantitative. For instance the rates and the transit time
are quantitative but the carrier's reputation or its loading and unloading facilities represent
qualitative attributes. As being stated by Liberatore & Miller (Liberatore & Miller, 1995), the
lack of a proven evaluation framework which attempts to weight both quantitative and
qualitative factors can lead to ambiguous results subjected to speculations and inconsistency.
The problem lies on the priorities being set by every individual shipper. Would the customer
service attribute be of great importance to the supplier? Then the given relative weight by the
supplier should be indicated by the MCDM technique.
48
6.3.1 DEA
Such a technique could be used by potential customers to evaluate the quantitative outcomes
with an ease of benchmarking the potential solutions. After the output criteria have been
clarified the cost of each proposal is being calculated and implemented. Below, we will present
an example of the procedure. The writer must clarify that the overall cost consists of individual
procedures that translate into costs. According to Ekol's Greece director Mr. Batakis the
occurring cost types generated from a typical intermodal trip are represented below:
Table 9: Intermodal trip costs
Type of costs
Transportation Costs
Handling Costs
Maintenance Costs
Declaration Costs
Last Mile
The last mile is the occurring cost that derives from the transportation from the final hub until
shipment’s final destination. Mr. Batakis underlines that a standard fee is charged no matter
the distance covered. In practice the DEA model proposed for an Ekol’s customer would be the
identification of the most critical characteristics taken from the list of Coulter et al., and the
grading of those from 1 to 5 according to a Likert scale.
Table 10: Likert scale
Likert Scale
Relative importance factor
1
Non importance
2
Minor importance
3
Medium importance
4
Much importance
5
Great importance
6.3.2 AHP
The following approach is designed based on the applied AHP method presented by Korpela
and Tuominen (Korpela & Tuominen, 1994) enriched by some elements to be tailored for a
fictional customer of EKOL. The procedure will be divided in the steps described on their
49
survey with some alterations. Due to lack of information regarding Ekol's customers the writer
will formulate an illustrative fictional scenario which will serve as a guide for further research.
6.4 Implementation of AHP
Step 1
6.4.1 Definition of the Problem
The first step of implementing the AHP approach would be the problem statement. Within its
range, the definition of the problem will have to establish the corporate goals of the company
(shipper), on the first level.
6.4.2 Fictional scenario
The Greek food production company A formed an unexpectedly new deal due to market
alterations and needs to transfer its products from Greece to Germany. The strategic decision
according to the board was to use 3PL services for transporting its shipments and more in
particular intermodal transportation since it comes in compliance with company's interest
both in financial and marketing areas. Only two feasible carriers exist providing intermodal
transportation services in the market. Carrier B and carrier C. Carrier B uses an extended
network with transit time of 6 days for the conclusion of the trip whilst carrier C offers better
rates, due to better contract deals with its partners, but has worse transit time of 7 days.
Company A decided to perform an AHP analysis for the determination of its new
transportation carrier. It is of great importance that the carrier meets company's ethics as far
as greener transportation policies and to build a healthy relationship looking forward to
further cooperation in the future. Other features of company A, are that the company foresees
an opportunity due to the logistics disruption that emerged and would like to gain a bigger
market share in the markets of Northern Europe. On the other hand, would like to remain
appealing to its customers providing the best market prices.
The outcome of the former scenario would be to exclude the company's corporate goals. The
writer will base his consideration to the study of Korpela and Tuominen (Korpela & Tuominen,
1994) where the writers use the hierarchy shown in Figure 15. In the beginning, we start by
decomposing the problem in order to identify the Goal, the Corporate Objectives, the Criteria
and the Sub-Criteria of our case. Korpela and Tuominen do not include decision alternatives as
being indicated by the traditional approach but substitute them instead with Ratings. Once
identified, we proceed to the next step by setting priorities in every element, in every level of
50
our designed hierarchy model. The last step would be the ranking determination of the
alternatives which in our case are companies B and C.
6.4.3 Goal
The goal of the excluded AHP analysis would be to select the best available intermodal
transportation carrier.
6.4.4 Corporate Objectives
At this point company A has a large market share in Greece market. The board's wish would be
to expand their turnover and increase their market share on European level taking advantage
of the opportunity raised due to market disruptions. The second objective for the company is
to become a competitive leader offering the best available quality and customer service. The
aim of the logistics process would be placed in the middle of transaction and relationship
based philosophy (Gibson, Sink, & Mundy, 1993). That would be a measurement focus which
aims to satisfy a set of qualitative criteria while still achieving the minimum cost for the
service. This is due to the unexpected demand that emerged but the board would consider a
more synergetic relationship in the future.
6.4.5 Criteria and Sub-Criteria
The Customer Service criteria are of great importance to company A since they constitute their
competitive advantage. Therefore the carrier selection would be focusing on their offering
service-related levels. The Pricing and Rates comes second while the Strategic Compatibility is
of less importance on the exact moment. The former consists of the following sub-criteria:
Reliability, flexibility, quality, security and equipment/facilities of the carrier. All of them
except security are included on the model of Korpela and Tuominen. Reliability in our case
consists of the ingredients described by Coulter et al., (Coulter, Darden, Coulter, & Brown,
1989) like Reliable transit time, Reliable pickup service and Speed of transit time. The Flexibility
element concerns the response of the carrier to urgent situations and special claims
demanded by the shipper. In accordance the Quality, on the first case at Korpela and
Tuominen regards the minimization of potential damages but the author will adapt Coulter's
version which includes the Quality of Customer Services, Quality of Sales personnel and
Completeness of service which finds more appropriate. The writer decided to include as an
independent sub-criterion the Security of the shipment. Ekol GR director Mr. Batakis indicated
that the recent trends in the Balkan region for intermodal transportation demand of carriers
securing their shipments with extra personnel in "danger zones" where the trains stop for
bureaucratic purposes or to change their machine. This takes place almost in every country's
51
boarder where different provider is in charge of the trip. For instance in Greece, it would be
OSE (Hellenic Railways Organization). The last sub-criterion would be the equipment/facilities
of the carrier.
The second category concerns sub-criteria under the Pricing and Rates. These include the
Rates for the completion of the trip denoted by Table 9 for the intermodal trip and are of
course defined by the shipment size and distance to be covered. The Flexibility of Rates refers
to the rate negotiation, the willingness of the carrier to negotiate his prices.
Under the last criterion column of Logistics Process the element of Long-term Relationship is
concerning the possibility of a Long-term binding between shipper and carrier. The Strategic fit
the marketing and image compliance between them. The writer considered adding an
Environmental image element as a newly added sub-criterion in relation to the original Korpela
and Tuominen model. But after reviewing the whole model he decided to integrate it in
Strategic fit sub-criterion. The environmental image of the shipper is of big importance if he
wants to keep up with the recent trends that suggest companies to search for "greener"
solutions. The last sub-criterion Continuous Improvement is the carrier's will for continuous
improvement to related shipper's interests.
6.4.6 Ratings
The lowest level in a normalized AHP approach would be the decision alternatives. In our case
it is represented by a grading system for the two carriers to be evaluated, being open to
potential inclusion of more. This way we can qualitatively describe every criterion on every
level subjected to every carrier.
52
Figure 15: Explanatory diagram of the applied AHP model
Select the
Best Carrier
Goal
Corporate
Objectives
Market Share
Competitive
Leader
Logistics
Process
Criteria
Customer
Service
Pricing and
Rates
Strategic
Compatibility
Sub-Criteria
Reliability
Rates
Long-term
Relationship
Flexibility
Flexibility of
Rates
Strategic Fit
Quality
Continuous
Improvement
Security
Equipment/
Facilities
Ratings
Outstanding
Above Average
Average
Below Average
Unsatisfactory
Source: (Korpela & Tuominen, 1994)
53
Step 2
The second step according to Korpela and Tuominen is to assign priorities to the elements. To
do so, we must proceed in a pairwise comparison of each level of elements beginning with the
first until the lower ones. In our fictional scenario and for simplistic reasons we assume that
the board of company A decides jointly with the grading procedure. Otherwise in real life
occasions and in case consensus cannot be established we consider the geometric mean of the
board member's judgments.
The procedure is described in details by Korpela and Tuominen (Korpela & Tuominen, 1994):
"As we start we compare the corporate level objectives in a pairwise fashion with respect to the
goal (what is the relative importance of each corporate level objective). Then the importance of
the main criteria is evaluated with regard to each corporate level objective (what is the relative
importance of each sub-criterion) and the importance of each sub-criterion is assessed with
regard to the main criterion they are linked to. The last step is to assign priorities to the ratings
with respect to each sub-criterion".
We proceed to the pairwise comparison on the first level of Corporate Objectives. We will use
a 9-point scale for grading the elements where 9 is the most important grade (9 times more
important than the other) and 1 sets the elements in equal grading importance. In case an
element is considered of lower value we use its reciprocal number, so instead of 3, ⅓. For
instance the market share corporate objective is considered by company A to be of equal
importance with being a competitive leader to the market so the grading would be 1. In the
same respect gaining a larger market share is 5 times more important than logistics process,
and competitive leader is 3 times more important than logistics process. In the last sentence of
the procedure we have to assign priorities to the ratings with respect to each sub-criterion.
Korpela and Tuominen use a software program named Expert Choice that automatically assigns
each rating with a specific number. Unfortunately the writer had no access to the software. In
our case we will use the classical approach suggested by Forman et al. (Forman, Saaty, Selley,
& Waldron, 1983), in which the authors apply numbers from 1 to 5 depending on the
multitude of the assigned ratings. In our case 1 would be equal to unsatisfactory and 5 to
outstanding performance. That means that outstanding is five times greater than
unsatisfactory an issue that Korpela and Tuominen criticize by suggesting the use of the
particular software which determines a fairer distribution of the grades of the rankings.
54
Step 3
After concluding the second step we have to synthesize the priorities of the AHP elements to
set up the overall priorities for the carrier selection alternatives. The third step includes the
steps 5 and 6 previously stated by Vaidya and Kumar (Vaidya & Kumar, 2006). The comparison
of each element in every level to calibrate them in a numerical scale and the identification of
the maximum Eigen value, consistency index CI, consistency ratio CR, and normalized values
for each criterion-alternative. For determining these values the author used the help of the
Excel formulas provided by Thomas Pyzdek (Pyzdek, 2014) which are presented in the
Appendix I.
Step 4
The final step reviews the actual performance of the carriers and ranks them. If necessary the
shipper proceeds to modifications until its decision meets the desired levels as Step 7 of
Vaidya and Kumar (Vaidya & Kumar, 2006) outlines.
6.5 Findings
An illustrative summary of the AHP analysis findings is given through the below figures. The
board of the company A through their responds selected the Market Share corporate objective
to be the most important with 47.99%, followed by Competitive Leader with 40.48% and finally
Logistics Process with only 11.49%. Within the Corporate objectives goals, the main criteria of
the carrier selection are being prioritized in regard to each objective as shown in the Figure 16.
So for the Market share objective the first criterion would be the Customer service with
26.73% followed by Pricing and rates 15.36% and Strategic Compatibility with 5.90%.
Figure 16: Corporate Objectives
Corporate Objective
Market Share
Competitive Leader
Logistics Process
0,00%
10,00%
20,00%
30,00%
40,00%
50,00%
60,00%
Customer Service
Logistics Process
5,52%
Competitive Leader
4,32%
Market Share
26,73%
Pricing And Rates
1,32%
25,63%
15,36%
Strategic Compatibility
4,65%
10,53%
5,90%
The next Figure 17 represents the rankings of the overall priorities for the carrier selection
criteria. The Basic Rates gather 37.02% of the shippers board preferences and it's the most
55
important criterion for the company A to choose its carrier. From a strategic point of view it
clearly shows that this is a transaction based philosophy which prerequisites a wide set of
carriers to choose from based on their offering cost for their transportation services. In our
case the intermodal service was offered by only two carriers so only them were included in our
analysis. It is important to mention that the Long-term Relationship criterion gathered only
1.75% of the preferences a fact that strengthens the former strategic consideration. One might
assume that the board of company A is looking forward to the minimization of the cost in
accordance to a reliable performance which is the second most important criterion. This
comes in contrast to what Evers et al. (Evers, Harper, & Needham, The determinants of shipper
perceptions of modes, 1996), suggest when in the Table 4 the rates for intermodal
transportation are on the fourth rank. Nevertheless, this is a fictional scenario and in real life
the board's decisions might be altered.
Figure 17:Carrier Selection Criterion
Carrier Selection Criterion
37,02%
16,09%
15,26%
7,90%
6,94%
5,28%
4,07%
3,77%
1,82%
1,75%
The analysis of the potential carriers in respect to the importance of each criterion as well as
the shipper ratings are presented in Figure 18. Carrier 2 gathers the 54.47 % of the preferences
while Carrier 1 45.52 %. For the most important criterion of Rates Carrier 1 performance is
considered to be average while for Carrier 2 outstanding.
56
Figure 18: Carrier selection
57
Chapter 7
The final chapter is the concluding chapter of this thesis in which the findings and the future
work of the research are being displayed.
7.1 Conclusion
The objective of this study was to answer the four research questions given in the initial part.
More in particular, the first research goal was to describe the conceptual framework of the
implementation in both unimodal and intermodal trips, describing the main operations from
theory to practice. The latter's analysis, on the one hand, was solely interpreting the theory of
a unimodal and intermodal trip set up and took place in the second chapter. On the other
hand, the third chapter was dedicated for the description of the status quo, in practice, in
Ekol's trips.
Subsequently, chapters four and five came in response to the second and third research
questions. The research had to identify and link with our case the decision criteria, those who
are primarily concerning the customers of Ekol Logistics. Those customers, expand from a vast
variety of industries. The singled out decision criteria categories in chapter four, all correlate
with Ekol's customers.
Lastly, the chapters five and six, are used in response to the last question about the theoretical
models that could be applied in Ekol's case, as far as, company's customers decide for their
carrier. More precisely, chapter's five aim is to display the theoretical economic models that
constitute the base for decision making of a shipper. Those account for mode and carrier
selection. It is a preliminary chapter before chapter six where the main part of the MCDM
analysis for carrier selection is taking place. Having already been argued, such a decision,
demands a lot of criteria to be taken into account simultaneously. The extracted AHP analysis
provided a decision making framework for Ekol Logistics and their potential customers. The
latter indicates this thesis contribution. However, the proposed AHP technique hasn't been
implemented by the company and as a result hasn't been tested yet.
7.2 Future work
This thesis could be used for explanatory reasons for a reader interested in the features it
pertains. Nevertheless, the nature of the shipment to be transported plays a significant role in
the carrier and mode selection process. In our fictional scenario the movement of susceptible
products require specific handling and operating requirements. This includes specific container
types such as ventilated or refrigerated. It also requires specific lead times for obvious reasons.
58
For other type of goods of greater value the security of the shipment might be of the greatest
importance when it comes for selecting the carrier. From the performed literature review the
writer haven't identified researches linking the carrier and mode selection with specific
industries. As a result, companies sharing the same characteristics like being environmentally
concerned or focusing on international transportation, were falling under the same category.
That was taking place despite the fact that the nature of their shipments and therefore their
transportation preferences were different. Seems that researchers view companies as a whole
system deciding jointly about their transportation plan and might neglect the special features
of every commodity to be transferred. Thereafter, the author would suggest of further
exploratory research on the field.
59
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http://log.logcluster.org/response/transport/index.html
Manaadiar, H. (2014, September). Shipping and Freight Resource. Retrieved from
http://shippingandfreightresource.com
Piraeus Container Terminal S.A. (2015, January). Retrieved from Piraeus Container Terminal
S.A.:
http://www.pct.com.gr/pct_site/index.php?option=com_content&view=article&id=8&
Itemid=274&lang=en
PrimoCargo Gmbh. (2014, October). Retrieved from PrimoCargo GmbH: Home:
http://www.primocargo.de/media/resources-center/container-types-specifications
Pyzdek, T. (2014, 12 10). Six Sigma Training. Retrieved from
http://www.sixsigmatraining.org/six-sigma-tools/ahp-spreadsheet.html
Ruiz, F. (n.d.). Retrieved from International Society on Multiple Criteria Decision Making:
http://www.mcdmsociety.org/index.html
List of Figures
Figure 1: The long-haul Freight transportation .......................................................................... 8
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Figure 2 : Performance by mode ............................................................................................. 10
Figure 3: An example of the intermodal journey...................................................................... 11
Figure 4: Indirect Transfer System ........................................................................................... 15
Figure 5: Direct Transfer System ............................................................................................. 15
Figure 6: The intermodal sea-road terminal ............................................................................ 16
Figure 7: Turnover of Ekol Logistics ......................................................................................... 18
Figure 8: Intermodal network from Turkey (without Greece's inclusion) ................................. 20
Figure 9: Alternative Intermodal journey including Greece and Balkan markets ...................... 22
Figure 10 : Transaction vs Relationship based Philosophy ........................................................ 30
Figure 11: Consequences of a Modal Shift ............................................................................... 36
Figure 12: The Classical Economic Model ................................................................................ 40
Figure 13:Inventory-Theoretic Problem ................................................................................... 41
Figure 14: Script-theoretic model ............................................................................................ 43
Figure 15: Explanatory diagram of the applied AHP model ...................................................... 53
Figure 16: Corporate Objectives .............................................................................................. 55
Figure 17:Carrier Selection Criterion ....................................................................................... 56
Figure 18: Carrier selection ..................................................................................................... 57
List of Tables
Table 1: ISO Standard Container types ................................................................................... 13
Table 2: Aggregated Carrier selection attributes...................................................................... 27
Table 3: Partnership importance ............................................................................................. 30
Table 4: Relative Importance of Individual Factors to Overall Perception for Each Mode ......... 31
Table 5: Factors determining the continuation of intermodal partnership ............................... 32
Table 6: Ranking in international setup ................................................................................... 33
Table 7: Key attributes for Carrier selection on both import and export shippers .................... 35
Table 8: The MCDM techniques according to popularity ......................................................... 46
Table 9: Intermodal trip costs.................................................................................................. 49
Table 10: Likert scale ............................................................................................................... 49
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