Maritime Transportation Case Study

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Topics: Ship, Ship
Maritime transportation is the backbone of global trading. More than 80% of global product distribution are using ship (United Nations Conference on Trade and Development, 2015). Therefore, it has several advantages compared to land and air distribution. Compared to air transportation, maritime transportation is more efficient in terms of cost and quantity. Maritime transportation also can cover sea and have inter-island connected which are cannot be done by maritime transportation. Indonesia, which have 3.544.743,9 km2 (Kementrian Sekretariat Negara Republik Indonesia, 2010) sea area is responsible to make its maritime as an advantages. Based on the operation type, maritime transportation divided into three, tramp shipping, industrial shipping, …show more content…
Basically, the objective function is to minimize total operational cost and the amount of used vehicles or in other terms distribution cost. Therefore, it is known that decision on the distribution route has significant impact to logistic total cost of a product. In some distribution cases, supplier and customer are include as the player of product distribution. In order to minimize the cost, all players in the distribution should work together and share some information regarding the distribution. Nevertheless, it is hard to applicate some kinds of system like that. Therefore, in order to reduce the cost and integrate all players in distribution, experts develop Vendor Managed Inventory (VMI) concept on purchasing approach. In this concept, a supplier maintains an inventory of certain products in the customer’s facility (Arnold & Chapman, 2008). Basically, the customer does not have to order any of the inventory, as the supplier is responsible for maintaining an adequate supply in the inventory of …show more content…
For ship distribution, several factors that become consideration are ship type, capacity, speed, voyage time, port dwelling time, weather condition, and other uncertainty in ship operation (Romero, Duran, Marenco, & Weintraub, 2013). Therefore, there are many of those factors are uncertainty and become one of cause in imprecision of ship distribution planning. One of the problems in ship distribution is Inventory Ship Routing Problem (ISRP). ISRP emerges from Vendor Managed Inventory (VMI) policy that inventory of a customer is in responsibility of the vendor. Therefore, in ISRP the decision of vehicle routing and inventory control done simultaneously in order to maintain customer inventory level as well as ensure that there is no stock out occur in the

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