Hong Kong 22.05.2015

1. LALITH EDIRISINGHE
A.W. WIJERATNE
JIN ZHIHONG
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2. Preamble
Container imbalance represents 22% of the overall
cost structure of containers
Half the time of container lifetime is idle as they are
either being maintained, repaired or in storage
 The paper identifies 22 strategies to maximize
container utilization under five categories namely,
Pricing; Forecasting; Operations; Collaboration; and
Customer care
It evaluates 12 factors that potentially influence
container inventory management strategies of carriers
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Striking a optimum balance between the customer
demand for carriage and supply of containers is the key
for optimizing the utilization of containers
The Approach

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Six factors to consider in optimizing empty
container logistics
1. Trade imbalances
2. Type of equipment
3. Ratio between carrier own containers and leased
4. Optimal leasing arrangement category (if containers are
leased)
5. Availability of new containers for purchase
6. Optimal repositioning routes, special repositioning tariffs and
storage tariffs -Karmalic, et al.,(2012)
The “box to slot” ratio is 2-to-1 -Weinschenk, (2012)
External container sharing is a strategic option
-Song & Carter (2009)
Literature Review

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An exploratory study - A process flow chart was
designed to identify critical
areas that needs vertical
investigations
An opinion survey- 105 shipping lines(those of
imbalance higher than 50
TEUs in 2013)
Questionnaires were used as
the method of collection of
data through online, mail,
and interviews
Methodology

6. Research Objectives
Primary Objective: Assess the strategies that lead
to optimization of utilization
of containers
Other Objectives:
Identify existing strategies (19) and propose new
strategies (03)
Define key categories (02) and identify factors
(12) that potentially influence above strategies
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Conceptualization
Strategies to Optimize the Utilization of Containers
___ Existing - - - Proposed

8. Conceptualization cont…
Categories of
Strategies (05)
Strategies (22) Categories of factors that
influence the strategies (02)
Factors that influence the
strategies (12)
Pricing Swopping 2x20’ with
40’
Substitute 20’ with 40’
Freight drop for Import
Freight drop for Export
Freight increase -Import
Freight increase-Export
Empty Repo Surcharge
Marketing Customer attrition
Brand name
Sustainability
Forecast Forecast Dependence
Service Agreements
Penalizing agents
Forecast accuracy
Synchronized budget
Revenue Cancellation of bookings
Slot cost
Port Handing Cost
CFS Rent
CFS Handling Cost
Container ROI expectation
Wear &Tear
Utilization Maximization
Underutilization of Vessels
Operational Container hiring
Round voyage Repo.
Customer care Agile inventory
Lean inventory
Priority for Imports
Priority for Exports
Seasonal demands
Collaboration Alliance
Interchange
Free slot

9. Analysis
The Ordinal Logistic Regression and Linear
Regression were used
Assumption X =ƒ (Z)
Container Inventory Management Strategies used by
Shipping Lines =X
Factors that determines those strategies =Z
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Results and Conclusions 1

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Results and Conclusions 2

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Results and Conclusions 3

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Results and Conclusions 4

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Results and Conclusions 5

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