Flow balancing-based empty container repositioning in typical shipping service routes
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Flow balancing-based empty container repositioning in typical shipping service routes Dong-Ping Song* and Jing-Xin Dong International Shipping & Logistics Group, Business School, University of Plymouth, Cookworthy Building, Drake Circus, Plymouth PL4 8AA, UK. E-mail: [email protected] *Corresponding author.
A b s t r a c t This article formulates the empty container repositioning problem for general shipping service routes based on container flow balancing. Two types of flow balancing mechanisms are analysed. The first is based on point-to-point balancing, which leads to a point-to-point repositioning policy. The second is based on coordinated balancing in the whole service, which leads to a coordinated repositioning policy. A simple heuristic algorithm is presented to solve the coordinated balancing problem which aims to minimize total empty container repositioning costs. The above two repositioning policies are then applied to a range of shipping services, representing typical route structures in existing shipping networks. The relative performances of these two policies and their sensitivity to route structure and trade demand are examined in both deterministic and stochastic situations. Managerial insights are subsequently derived. Maritime Economics & Logistics (2011) 13, 61–77. doi:10.1057/mel.2010.18
Keywords: container shipping; empty container repositioning; flow balancing; liner shipping; route structure
Introduction Container shipping is one of the fastest growing sectors of the shipping industry. As the world trades are getting more imbalanced in recent years, particularly the Trans-Pacific and Asia-Europe routes, empty container operations have incurred r 2011 Macmillan Publishers Ltd. 1479-2931 Maritime Economics & Logistics Vol. 13, 1, 61–77 www.palgrave-journals.com/mel/
Song and Dong
substantial costs. For example, Drewry Shipping Consultants reported that empty containers have accounted for at least 20 per cent of global port handling activity ever since 1998 (Drewry, 2006). It was estimated that the cost of moving empty containers around the globe exceeded US$15 billion in 2002 (Song et al, 2005). Therefore, efficiently and effectively repositioning empty containers has become an important strategy for liner shipping companies to gain competitive advantage. There has been abundant literature related to empty container repositioning modelling. Under the scope of the problem under consideration, models may be classified into three categories: empty container allocation among inland depots, customers and ports; empty container repositioning between seaports; empty container management in intermodal transport. For example, Crainic et al (1993a, b) considered the container flow balancing in inland transportation network. Bourbeau et al (2000) focused on the depot location and container allocation. Empty container repositioning between seaports with general network structures can be found in White (1972), Shen and Khoong (1995), Cheung and Chen (1998), Choong et al (2002), Cheang and L
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