Logistic and Supply Chain Management

LOGISTIC AND SUPPLY CHAIN MANAGEMENT 1
Logistic and Supply Chain Management
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LOGISTIC AND SUPPLY CHAIN MANAGEMENT 2
Case Study: Port Logistics City
Part One: Case Analysis
It is imperative that the Port of Melbourne is the busiest port in Australia for
containerized as well as the general cargo. The location of the Port is in Melbourne, Victoria.
The Port covers a vast area at the mouth of the Yarra River. From its location it is downstream of
Bolte Bridge at the head of Port Philip which is a statutory corporation that was developed by the
State of Victoria. However, the recent years Melbourne as a port logistic city has undergone two
major changes. It first experienced the consolidation of the land used. This change was
introduced by the Government of Victoria with the primary aim of promoting a greater
agglomeration of the transportation and logistics companies that were in close area to the Port of
Melbourne. The other key change was the suburbanization of freight activities. This started to
move inland in Melbourne. The inland shift of all the freight activities was caused by
deagglomeration.
Part Two: Issues/ Challenges
Question One: What are the three major challenges for Melbourne as a port logistics city?
To begin with, one of the key challenges to the Melbourne Port logistics city was the
reconfiguration of the freight systems in the Melbourne metropolitan. This reconfiguration leads
to the development of an unsystematic movement of the freight into as well as out of the port. In
this case, the distribution of the general population was not equal hence causing the movement of
a lot of empty containers as well as the raise in inland transportation cost (Mangan and Lalwani
2016). The fact that there is only one primary road corridor which connects the western and the
eastern suburbs, as well as the location of the logistic clusters in the west, causes an increased

LOGISTIC AND SUPPLY CHAIN MANAGEMENT 3
distance and freight flow. It is from this fact that the transportation cost for the inland freight
flow is so high.
The second key challenge for Melbourne as a major port logistic city in Victoria is the
reliance on trucks that have fixed destinations. This heavy dependence on trucks as the primary
means of transportation for goods as well as the operation of the truck on specific schedule
causes transportation bottlenecks. As a result, there is an increase in the delivery lead time as
well as reduced chance of the usage of vehicles. It is for this reason that Mangan and Lalwani
(2016) notes that traffic gridlock costs have been estimated to increase to 53.3 billion dollars as
of 2031. It has to be noted that the cost of congestion alone in the city in 2011 was $ 3.6 billion.
The third key challenge to the Port logistic city is the infrastructure. It is imperative to
note that Melbourne as a city does not have an effective as well as efficient implementing the
freight system within the setting of the city. The fact that a Port Logistics city needs an
increasingly agile freight network makes it a major problem. Melbourne is incapable of
providing a quick response to the increasing demand for global production because of its poor
infrastructure (Mangan & Lalwani, 2016). The city does not have effective means for
consolidation, break bulk as well as transshipment functions hence presenting many logistical
challenges.
Part Three: Alternative Solutions
The alternative solutions to the problems or challenges indicated above are based on two
strategies that will boost first movement of products to lower the inland transportation cost. As
already noted, the challenges are a result of Melbourne being a densely populated city hence the
issue of gridlock in peak hours. In the city of Melbourne alone, there was an estimated cost of
congestion that sums to 3.6 billion dollars as of 2011. More so, the direct transfer of shipments to