Transport Efficiency through Logistics Development

As such, there is a strong need for a modern transport and logistics system that is efficient, safe, and sustainable, and that better serves clients’ needs.

Second, an excessive number of documents are required to move cargo. As many as 100 documents are required to meet port, rail, highway, customs, quarantine, and insurance requirements while moving international containerized cargo. These documents are designed by different authorities, often asking for the same set of data, with little regard for the burden they place on trade

• Drop-and-pull operations. This method of operation is commonly used in developed countries such as Australia and the US, as well as countries in Europe. Under the right conditions, the method can significantly increase operating efficiency and reduce costs. In the PRC, it is particularly useful in promoting sea-to-rail and road-to-rail multimodal transport. Unfortunately, public security bureaus regulate trailers in the same way as they regulate tractors, leading to much higher insurance premiums for trailers compared with in developed countries

Table 8 Major Challenges Faced by Logistics Enterprises
Ranking
Major Challenges
Score
1
Unhealthy competitive environment

Poor standardization (waybill, equipment

Table 6 Cost of Getting a Backhaul

• The PRC’s road transport market is populated by many small carriers (with average fleet size of less than 1.5 trucks). Excessive competition in the marketplace has kept road transport charges very low.

. The PRC is able to provide low-cost transport services mainly because of these factors:
• The PRC’s road transport market is the most extensively used among the different modes of transport, with price being the most critical competitive differentiator.
• Due to limitations in government supervision, the PRC’s road carriers resort to excessive driving hours, extreme overloading, and illegal equipment modifications to improve their operating efficiency

Transport cost is the largest component of logistics cost. At 52.6%, the PRC’s transport cost component is lower than that of many countries. For example, in the US, the transport cost was 63% of logistics cost in 2009; in 2008, it was 65%.

Compared with other countries, the PRC has a much larger rural population, which is geographically dispersed and substantially more expensive to serve. Transport demand is fragmented, and the efficiencies of many transport providers are low