Main Advantages of Port-Centric Logistic Zones

Main Advantages of Port-Centric Logistic Zones

Activities related to freight distribution had historically been located directly adjacent to port terminal facilities and were having a notable spatial imprint. Containerization incited the development of new terminal facilities and relocation of many warehousing activities into peripheral greenfield sites, leaving former warehousing and industrial land idle, abandoned, and often reconverted to other uses. The outcome for many container ports was a disconnection between the port and the distribution activities it was supporting. With growing levels of congestion around several ports, this strategy is being reassessed as supply chain managers consider the advantages of port-centric logistic zones:

  • Land. The developers of port-centric logistic zones, commonly port authorities, have secured a significant real estate base next to port facilities; in co-location. This often takes place with the conversion of brownfield sites (e.g. abandoned industrial or warehousing facilities). As many port facilities are near central areas, recruiting labor tends to be less problematic than at peripheral sites.
  • Drayage. Since port-centric logistic zones are adjacent to terminal facilities, trucks have direct access to terminal gates and able to quickly retrieve and deliver containers. Since trucks do not require to go through local roads, weight restrictions are less impairing the stuffing of containers. There is thus the potential to take full advantage of the weight limits of container loads and have more freight loads being carried.
  • Container assets. Port-centric logistic zones maximize the efficiency of transloading (e.g. transferring the contents of maritime containers into domestic containers or truckloads), which lowers dwell time. Maritime shipping companies are thus able to quickly get their empty containers back, which can then be repositioned to loading locations.
  • Supply chain management. There are several supply chain advantages in using port-centric logistic zones. Depending on the configuration of the hinterland (most of the customers within 600 km), the distribution center can provide direct deliveries by truck to customers, which is associated with lower lead times and inventory levels.