Enhancing the Viability of Urban Consolidation Centres: Models, Methods and Applications

An urban consolidation centre (UCC) is a pivotal facility initiated to reduce the negative impact generated by urban logistics activities. The UCC is an intermediate facility that connects intercity transportation with their clients (e.g. stores, offices, restaurants, etc.). The function of UCCs is to trans-ship goods directed to urban areas, aiming to consolidate deliveries, and thus provide greater efficiency (and effectiveness) in the distribution process by increasing the truckload factor and replacing heavy trucks with smaller vehicles that are more suitable for urban deliveries, which helps to mitigate urban congestion and air pollution. Despite the potential benefits of UCCs, these projects often fail to be self-sustaining, with many relying on subsidies from local authorities. This factor is the main obstacle that prohibits the long-term sustainability of this project. Through the literature review, this thesis identifies the reasons for such an issue - that UCCs cannot balance the interests of different stakeholders. Specifically, although UCCs can alleviate the environmental and social problems generated in urban logistics, the commercial interests of private stakeholders (e.g., logistics service providers, goods receivers) may be harmed by this project. As a result, UCCs will fall into deficit due a to lack of private stakeholders subscribing to this project. In response to the above issue, this thesis aims to improve the quality of stakeholders engagement during UCC planning, which enables the concerns and objectives of different stakeholders to be well considered. Based on this, the UCC can be designed reasonably to satisfy the requirements of various stakeholders, thus attracting private stakeholders to join the project. This thesis comprises four sections. In the first section, a formula-based cost structure is designed to enable planners to estimate the financial performance of UCCs in the project formulating phrase. The second section is based on four different UCC models in Sweden and China. This section reveals the result of stakeholders engagement in terms of the stakeholders' objectives, users’ needs, value propositions of UCCs’ services, and the stakeholders' partnerships in these UCCs. It provides an insight into how to design UCCs so that they can generate benefits for different stakeholders. In the third section, also based on the above four UCCs, a mix-method approach is implemented to evaluate the divergence of conflicts between different stakeholders and identify the reasons for these conflicts. The fourth section aims to use the cost allocation method to mitigate the financial burden of UCCs that are caused by insufficient users. Three kinds of cost allocation rules are proposed, the results illustrate that UCCs can benefit from the designed cost allocation mechanism through incentivising stakeholders’ participation in UCC projects. The last section introduces a decision-making tool, which could display the cost details of different UCC scenarios, thus promoting the strategic design of a UCC This thesis contributes to both theoretical and practical aspects. For the theoretical contribution, through the comparison of four successful UCCs, presented evidence is coherent with the view that a sound UCC project can benefit all the stakeholders based on the stakeholders’ engagement. Furthermore, the findings can contribute to a better understanding of the exposing and addressing of the disagreements between stakeholders’ preferences during stakeholders’ engagement. Lastly, it is evidently clear from the findings that the cost allocation method successfully alleviates the financial burdens of UCCs by fairly and efficiently sharing the cost to upstream and downstream stakeholders. For the practical contribution, the implemented methods and formulated models can be applied as an instruction to promote stakeholders’ engagement during the UCC planning. Furthermore, the decision-making tools enable decision-makers to address the issues about cost control of UCCs as early as the project preliminary stage. All these factors can increase the success rate of a UCC project.