Papers

Global supply chain optimization to achieve better efficiency in respect of environmental constraints recently motivated several research works on the idea of the physical internet as a worldwide open logistics system intending to bring new models that make the current logistical systems more flexible and sustainable. The developed concept aims to profoundly change the way objects are handled, stored or moved, taking inspiration from the digital internet. Physical Internet reproduces many concepts from the digital Internet, which are based on packet data transmitting in the TCP-IP protocol using routing protocols.

The objective of this study is to evaluate the contribution of physical internet on reducing logistics costs and improving the quality of service in PI-cross docks. Given the significant difference between the digital and physical systems, such a study is necessary to evaluate the efficiency of investments linked to the implementation of physical Internet.

Two simulation models are proposed to compare performances of a classical cross dock and a PI-cross dock under the same flow.

The first model is for the simulation of a real and classic cross dock with an incoming flow of three different types of household appliances products (type 1, 2 and 3) coming from different suppliers. The model considers three incoming docks, three outgoing docks and a warehouse separated into three areas (one area for each type of product). The cross dock uses 9 forklifts for unloading, loading and storage. Each one of the three incoming docks handles one type of products and each one of the incoming trucks comes with one type of products. For example, an incoming truck carrying product type 1 will be unloaded in dock 1. When a truck arrives in an incoming dock, products are unloaded in the reception area of the dock using the available forklifts, and each one of the incoming docks has one reception area. In the other side of the cross dock facility, there are three outgoing docks. Trucks arrive with their orders related to one or several products. In order to respect the FIFO rule, forklifts pick up products from the warehouses first. But if the quantity in the warehouse is not sufficient, the requested quantity will be picked up directly from the reception areas, if there is a truck unloading the requested product.

The second model is for the simulation of the automated cross dock (PI-cross dock), keeping the same flow of incoming and outgoing trucks and the same level for receptions and orders. The characteristics of the cross dock facility are also the same as for the first model (the surface and the number of incoming and outgoing docks). However, instead of using forklifts, automated loading and unloading resources (PI-docks) connected to a sorting area (PI-sorters) using PI-conveyors are considered. In the PI-cross dock, manual forklifts for storing and retrieving products in the temporary warehouse are replaced by an automated storage and retrieval system (AS/RS) that is connected directly to the sorting area with three storage and retrieval machines, one machine for each kind of product. When a truck arrives to an incoming dock, the PI-dock unloads automatically the products which will be moved to the PI-sorters using PI-conveyors. Trucks’ orders are served using the available products in the warehouse. The required products are picked up using the AS/RS system and then they come through the sorting area (PI-sorters) and to the PI-dock through PI-conveyors. However, if the requested quantity is not sufficient to serve the truck and if there is a truck being unloaded in the incoming PI-dock then the products arrive directly from that PI-dock.

The objective of this simulation is to compare and evaluate the KPIs (Key Performance Indicators) of each one of those cross docks such as the total time spent by a product in the cross-dock, the waiting time of incoming and outgoing trucks, and the usage of resources under the same flow of incoming products and orders, keeping the same surfaces for the two cross docks.

After running the two simulation models under the same flow, the average total time (cycle time) spent by the three products in the cross dock is reduced by 31%. The waiting time in the docks is reduced by 90% and the resources usage is reduced by 87%. Further research is ongoing on more complicated configurations related to the system of an industrial partner. However, from those initial results; it is very clear that if the arrival and the departure of trucks are well synchronized, PI-cross docks can greatly improve actual quality of service and resources occupation.

The Physical Internet is defined as “a global logistics system based on the interconnection of logistics networks by a standardized set of collaboration protocols, modular containers and smart interfaces for increased efficiency and sustainability”. As the recent development of the Physical Internet contributes to a more efficient usage of transportation and logistics technologies, the question arises whether these technologies may have a varying impact on countries’ economic performance. Thus, it is crucial to understand the drivers of transportation volume in the first place. This research conducts a country-level analysis of the determinants of growth of transportation volume by employing data collected for 28 European countries for the 10 year period of 2004-2013 from two data sources: (1) Eurostat and (2) World Bank. We especially focus on two modes of transportation technologies: water transport and road transport. By highlighting the close relationship between country-specific factors and the growth of transport volume, we extend the general framework of the Physical Internet by explicitly taking factors into account which in most cases cannot be directly influenced by logistics decision makers. This research therefore integrates a macroeconomic perspective into the overall Physical Internet framework.

Today's distribution and transport logistics suffer from significant inefficiency  factors mainly due to lack of resource and infrastructure sharing. According to some recent studies, the current transportation efficiency is in the neighborhood of 10%.  In the traditional commodity supply chain delivering fresh food, trucks often go either empty (to return the truck and/or driver to their home location) or partially empty (due to unavailability of suitable product or perishability concerns of the carried food). This leads to largely avoidable distribution costs, transportation carbon footprint, road congestion, delivery delays, etc. Yet, a significant percentage of fresh food is wasted due to real or perceived spoilage or loss of quality of fresh food from farm to the end customer. This paper exploits the ongoing technological developments to devise a mechanism for distributing perishable food packages while at the same time minimizing the empty miles to improve the fuel-efficiency.

One major obstruction to improving efficiency and decreasing food waste is the lack of universal sharing of logistics, particularly among the large vendors. However, the improving technology and the pressures to reduce cost are resulting to rapid growth of 3rd party logistics (3PL) and its derivatives such as 4PL which already account for more than 54% of the distribution logistics. 3PL involves outsourced logistics services using shared resources (warehouses, trucks, drivers, loading/unloading equipment etc.) and can achieve significant savings. Another key obstructions of logistics is the need to find drivers, ensure that they do not drive for more than the safe period, and get them home most nights. 

In this paper, we introduced the notion of a worker-friendly, "fresh food physical Internet (FFPI or F$^2\pi$)" architecture and explored the mixing, packaging and delivery of food packages in different parts of the food pipeline. With food sourced from every part of the country and from around the world, food supply chains are extremely complex pathways from farm to the table. Health concerns have prompted a rapid rise in the demand and consumption of fresh fruits and vegetables, with consequent emphasis on cost effective supply of freshest food to the consumer. The sustainability concerns and local food movement have further emphasized the issues of freshness, quality, intelligent sourcing, and most cost effective transportation of perishable food items. The distribution process of perishable food commodities follow extremely complex pathways from their origins to the consumption points, due to their constant deterioration with time, which makes the modeling and improvement of such logistics extremely difficult.

In a similar note, physical Internet has been studied recently that attempts to revolutionize product distribution logistics by emulating the Internet. The key issues in making the distribution logistics more efficient, flexible, cheaper, and more user friendly include (a) standardization of identification, labeling, packaging, transportation, tracking, etc, (b) sharing of physical distribution infrastructure among multiple companies, and (c) worker friendly logistics (e.g., enabling truck drivers to return home for the night). While the architecture of physical Internet introduces a number of key characteristics, the requirements of food freshness remained untouched. The key characteristic of F$^2\pi$ is the constant deterioration in quality of a food packages based on the delay in the distribution pipeline and handling factors such as temperature, humidity, vibrations, etc. In this paper our key objective is to extend this physical Internet model to address the distribution challenges of "food logistics". We first develop a "freshness" metric of different food products as a function of flow time through the logistics system.  The deterioration as a function of time $t$ can be described by a non-decreasing function that we henceforth denote as $\zeta(t)$. In general, $\zeta(t)$ is linear for fruits or vegetables and exponential for fish/meat. The decay itself is a complex phenomenon and could refer to many aspects, including those that can be directly detected by the customers (e.g., color, texture, firmness, taste, etc.) and those that are latent but perhaps even more important, such as degradation of vitamin content or growth of bacteria. Furthermore, the decay rate is strongly influenced by the environmental parameters such as temperature, humidity, vibration etc.

Another key concept addressed in this paper is the notion of "infrastructure sharing" among the different agents in the food pipeline. In the traditional supply chain, the trucks often go almost half-empty in the delivery process, which increases distribution costs, transportation carbon footprint, road congestion, delivery delays, etc. Furthermore, it appears that most major companies use their own private logistics network including trucks, warehouses, etc. Although smaller companies seem to be using 3rd party logistics (3PL), it is not clear if there is really a true sharing of capacity among them -- as opposed to each reserving and paying for capacity explicitly. A true pooling of resources (warehouses, trucks, drivers, loading/unloading equipment and personnel, etc) can achieve significant savings. However, there are numerous issues that come up in cooperative logistics, due to the additional complexity of sharing of equipment (trucks, forklifts, RFID infrastructure, etc), facilities (distribution centers, chillers), and personnel (truck drivers, loading/unloading personnel, RFID trackers, etc). These, in turn result in complex problems of assignment, scheduling, personnel welfare, disposal of spoiled food, equipment/facility maintenance, etc. 

We also explore the idea of shared logistics to "reduce trucker's time away from home", by dividing the long journey of a truck drivers among multiple drivers. The idea is to divide the entire operational area into multiple zones driven by the locations of distribution centers, and limit a truck run to within a zone only. The inter-zone delivery requires multiple trucks run with each driver returning back to its source after passing on the contents to the next truck across the zone boundary. Ideally, the returning truck will also carry compatible products in the other direction. This requires rather close cooperation and interactions among the agents in the food pipeline, that are used to work in isolation. The continuous perishability of the food products further complicates the matter. We believe that the proposed F$^2\pi$ architecture will complement the existing efforts of emulating the digital Internet into the traditional logistics networks. Even if we address this in the context of fresh food logistics, our methodology is generic enough to be adapted to other logistics systems as well.

City logistics provides the final and last segments of the physical internet logistics and transportation networks. In this paper, we will present a new scheme for big cities where we imagine the use of most existing public and private infrastructures and means of transportation to deliver encapsulated goods rapidly and safely from origin to destination. In order to enhance the efficiency and sustainability of current transportation systems, we propose with the help of existing different means of transportation and platforms as a city backbone, to determine the optimal localization of urban-hubs and open DCs. For that, we will use the map of transportation lines of Casablanca city (the biggest city, principal port, and economic capital of Morocco) to minimize the maximum travel time (or distance) and ensure a better interconnectivity between nodes. We will also determine some criteria to choose the nodes that can be used as an urban-hubs or DCs.

Using existing means of transportation and platforms intelligently, encapsulated goods will be delivered more efficiently.

Over the last decade, the e-commerce industry revolutionized the way people are shopping, and transformed the B2C industry, increasing the needs for home delivery. In a world where urbanization creates mega cities, last mile delivery becomes a real issue for both urban planning and logistics providers’ operating costs. Born from the Physical Internet’s concepts, Smart Lockers Terminals bring a solution to absorb the growth of e-commerce in urban areas, leveraging consolidation opportunities, or crowdsourced delivery opportunities. Parcel delivery companies already implemented this solution, sometimes along with a network of partnered business access points. We examined in this paper the different business models and capabilities they offered to better understand the trends that will change the way we deal with parcel deliveries tomorrow, focusing on the development of the Smart Lockers Terminals solution.

Open asset sharing is one of the concepts that forms the basis of Physical Internet. Naturally, interests of different parties are conflicting in such setting especially when existing assets independently owned by participants are now shared. Therefore, it is important to consider the impact of strategies of participants to successfully implement hyperconnected logistic system in real world. Moreover, the benefits of hyperconnected supply chain can vary significantly by strategies of participants. We examined the impact of inventory policy on the performance of last mile delivery of furniture and large appliances in urban setting under scenarios where retailers are openly sharing their logistic assets, storage and delivery, using simulation. Significant difference in savings achieved by open asset sharing by inventory policy has been shown which further highlights the importance of behavior of participants for successful implementation of Physical Internet in real world.

Computer networks and Logistics systems are two very rich fields of study that have grown almost entirely separately since they deal with entirely different entities – information packets vs. real commodities. Recently Physical Internet has been studied that attempts to revolutionize product distribution logistics by emulating the cyber Internet. While the architecture of physical Internet introduces a number of key characteristics (standardization of labeling and packaging, sharing of physical distribution infrastructure among multiple companies, worker friendly logistics etc.), the requirements of perishable logistics and their fresh delivery remained untouched. The distribution of perishable commodities such as fresh food, perishable pharmaceuticals, blood, etc. brings in some special challenges and opportunities that make comparison with information networking particularly apt.

In this paper, we show that considerable synergies exist between Information Networks (IN) carrying time-sensitive information and Perishable Commodity Distribution Networks (PCDN), which can be exploited for solving complex problems in both fields. PCDN involves a flow of packages or package containers (that we can regard as packets) from source (e.g., farm, factory, blood bank, etc.) to destination (e.g., retailer, hospital, etc.). The flows may pass through some intermediate distribution centers that “store and forward” the packets much like IN routers. Most flows also have Quality of Service (QoS) constraints in terms of delivery times and/or flow bandwidth (volume delivered/day). Other than that perishable goods often deteriorate in quality (or freshness) and value as a function of flow time (and other parameters such as temperature, vibrations, etc.) although some perishable goods, such as blood, have a fixed expiry duration. Similarly IN packets often have fixed deadlines, but there are scenarios where the value of information decays steadily with the delay incurred, such as in sensor networks or in financial transactions etc.

However, there are important differences as well. The most fundamental characteristic of a physical packet (or package) is that it is “unclonable”; it can exist only in one place at a time – even though one could surely replace a lost packet by an identical one from the source. Another fundamental difference is that unlike IN, physical packets do not move by themselves; instead, they need one or more additional resources for successful transit. The most important resource is a carrier, which could be a truck, railcar, plane, boat, etc. and the associated driver (unless the carrier is self-driven). Other resources include containers (perhaps even containers within containers), and load-unloading equipment. Although IN systems sometime consider circulation of empty frames that are filled up as the frame passes a sender node, this is rare. INs may also need other resources (buffers, transmission and processing capabilities etc.), but the functionalities are often far simpler. In particular, in PCDN the resources such as trucks, containers, drivers could be distributed throughout the network and need to be properly positioned, whereas the IN resources are generally non-mobile.

In spite of some fundamental differences between IN and PCDN described above, we believe that there is considerable value in attempting to capture the essence of both in a single model. Towards this end, we have explored a 5 layer networking model that encompasses both IN and PCDN and allows application of ideas and techniques across two very different fields. The first layer is the “Physical Layer” that deals with the actual movement of a packet along a media segment or channel. The second layer is the “Media Switching Layer” that provides the media/channel selection, media bridging, and switching functionalities. Then comes the “Routing & Distribution Layer” which supports end-to-end transfer of packets by handling packets at and across distribution/routing nodes. The fourth layer is the “Transport/Delivery Layer” that concerns the end-to-end assured delivery of individual packets (which may have been bundled recursively before transportation and then unbundled for final delivery). The destination will check the packets for loss, damage, deadline expiry, and quality degradation, and accordingly make decisions regarding reorder or replacement. Finally the job of the “Virtualization Layer” is to share the network capacity efficiently while still ensuring isolation among the various services/applications. In particular, this layer can define and maintain one or more virtual networks that are then mapped on to the physical network.

The layering allows us to introduce modeling simplifications via level-specific abstractions. As the automation in PCDN increases, the layered architecture becomes more and more important as it regularizes the product handling at various points. In situations where layering hinders efficient operations, cross-layer methods can be exploited to address them while still limiting the overall complexity. In this paper, we illustrate how such a view can be useful in exploiting the synergies, and expect that it will lead to much broader collaboration, cross-pollination, and unique insights that will significantly advance both fields.

Given the complexity of packet transit in such a unified model, its mathematical modeling is quite challenging and goes well beyond the simple queuing theoretic modeling that is quite common in IN. In particular, such modeling not only needs to deal with batch transmission (or bundling/unbundling), but also with allocation/deallocation of multiple resources whose scope often extends to the entire network instead of being limited to a node or link. The contention for resources results in the “blocking” phenomena, which can be quite difficult to model. For example, a transit may be blocked waiting for arrival of additional packets (to satisfy batching requirements), a suitable number of containers, and a carrier. The containers and carriers may in turn be held up elsewhere in the network. Thus approximate solution methods are almost mandatory, and developing an approximation technique and characterizing its properties becomes quite challenging. In this paper we propose an analytical modeling of such an approximate scenario using the idea of batch queuing and analyzed the impact of waiting time latency of the packages for resources (trucks) on the freshness delivery quality of these packages. We also validate the correctness of our analytical modeling with extensive simulations. We expect that the paper will motivate researchers in the two communities to exploit further synergies and thereby advance both fields.

This paper investigates performance of interconnected logistics networks confronted to disruptions at hub level. With traditional supply chain network design, companies define and optimize their own logistics networks, resulting in current logistics systems being a set of independent heterogeneous logistics networks. The concept of PI aims to integrate independent logistics networks into a global, open, interconnected system. Prior research has shown that the new organization can reduce the actual transportation cost through the optimization of full truckload and integration of different transportation means. Continuing along these lines, this paper examines how the interconnected logistics networks applying PI deal with disruption problems at hubs. To attain this, a multi-agent based simulation model with dynamic transportation protocols is proposed. Random disruptions at hubs are considered. Case studies of FMCG cases in France have been taken out. Results suggest that though exposed with disruption risks the PI is a robust logistic system. This paper indicates a novel approach to build a resilient supply network.

As the transportation modes and free trade agreements between countries evolves, the flow of goods increases all around the world. There is thus a pressure on the logistic web to optimize its design and management such to lower its cost and its impact on the environment. However, the efforts done individually by companies are far from sufficient to lower substantially the CO2 emissions and the cost involved along the logistics web. To cope with this, logistics web needs a major shift on the way physical objects are moved, stored, realized, supplied and used throughout the world. The Physical Internet initiative has been proposed by Montreuil (2011) to address this grand challenge. 

There are many factors that makes actual logistic web costly and inefficient. One of these factors is that the facilities realizing and storing the products are typically long to build and need a high investment. To address this challenge, this paper focuses on hyperconnected mobile modular production which is one of the concepts proposed in the Physical Internet scheme is the which focuses on the realization web interconnecting the way physical objects are realized (e.g. produced, made, assembled, finished, etc.). The modular concept can also be applied to storage of some of the finished goods in the distribution web. (stored closer to customers). These are two of the five components of the logistics web (Montreuil et al. 2013). The paper thus proposes a modeling approach that addresses the dynamic deployment of resources of the realization and the distribution webs while considering its link with the supply web and the customers demand through a production and an assembly process.

The approach exploits and enhances the well-known modular production concepts (Starr 1965, Tompkins et al. 2010) and builds on the recent process and technological innovations on mobile modular containerized production (Lier 2015) and labs (Shibomana 2015). Presented at the 2nd International Physical Internet Conference in 2015, the projects of Bayer and of Proctor and Gamble are developed under the modular production scheme (Kessler 2015, Lier et al. 2013, Lier et al. 2015, Shibomana 2015). Hyperconnected modular production exploits the dynamic deployment of (containerized) production modules in open facilities (fabs) across territories for enhanced flexibility and adaptability. The facilities are designed to ease the implementation, operation and relocation of the production modules. 

Lack of trust is one of the biggest barrier for the adoption of the Physical Internet (PI). Building trust requires safeguarding the integrity of data and software, especially on the smallest computational units of the PI; the smart tags. This research project focuses on a lightweight Root-of-Trust model and takes the dynamic nature of the IoT and the PI into account. Therefore we propose a secure firmware update mechanism for smart tags. By measuring the performance on a low-cost hardware we proof the applicability and pave the way for trust in the Physical Internet.

Considering the ideas of the Physical Internet (PI) this paper summarizes researched and engineered core elements of small load containers being essential for the implementation of small loads distribution systems. 
In general the European freight market can be characterized by rising transport needs coupled with a shortage of resources. Increasing customers service awareness, pluralization of life forms and ongoing developments in the e-commerce area are growing the amount of transports in general and in the fields of small loads (packages, unit loads or luggage) especially.

These actual trends require new service portfolios in the small loads market. In order to align environmental needs to the hitherto relatively inflexible systems of customer deliveries new approaches outside the current paradigm are demanded. The Austrian smartBOX project allows a new framing of the small goods transportation by the conception of an intelligent and holistic approach, considering the ideas of PI and aligning those to the needs of the future.
Thematic outline and research approach to the smartBOX developments:    

• At first existing barriers and practical problems in the segment of parcel deliveries were raised by interviewing market participants from the CEP sector by use of guideline-based interviews.
• Furthermore desktop research and qualitative content analysis yielded results regarding future developments and framework conditions for several delivery scenarios. 
• In a next step those conditions and facts were assigned to predefined categories like market, logistics, law, economics and infrastructure and led to a comprehensive description of the business processes containing all core elements of the framework including trends and customer needs.
• Following these theoretically and practically compiled preconditions a certain amount of use cases was defined as basis for the development and engineering of a comprehensive and integrated concept called “small loads mobility 4.0”. This highly integrated approach includes complete new rules for the business logics as well as the technical elements like construction details of reusable and environment friendly containers – the smartBOXes –  and related IT-components.
• Based on this concept performance figures as well as detailed system functionalities were derived finally.

Description of the paper content:
The designed business process concept and the technical equipment for the new smartBOX system follow ideas and aims which are specifically subject to PI principles. The paper illustrates how the smartBOX concept is leading to “small loads mobility 4.0”.

The main targets of traffic reduction and of increase of truck fill rates are realized by execution of asset sharing. The main idea is to distribute all kind of small goods and in particular packages, small unit loads and luggage via a service provider open network, allowing transport quantities to be bundled at all transport steps in order to make the flows of goods economically, ecologically and socially more efficient as well as more sustainable. Furthermore, a so called hyper system is designed to centrally host all relevant transport data within a protected but open data cube.

Information flows are made accessible to all market participants in order to manage the material flows through a system of open infrastructure (including asset sharing at all steps of delivery processes) without friction losses. A selected operator or the hyper system itself controls and regulates the access to information that is relevant for ICT and logistics. In addition to the technical design the legal and logistical framework conditions are drafted to enable the integration of existing providers and common infrastructure efficiently.

The paper defines and describes the functional elements of a typical smartBOX operator or of a smartBOX hyper system as: ICT, logistics, organization & legislation and infrastructure. 

The paper documents how business processes and the resulting use cases were created as research basis for the development of practical application areas leading to the integrated and new small loads mobility 4.0. 

Derived from the requested functionalities of the predefined use cases, specific performance contents of the designed system could be collected in a next step. By comparing the use cases and the status quo situation in the CEP sector regarding user processes and business models the three core elements standardization, equipment (container & terminal) and ICT should be analyzed and forecasted to identify remaining practical challenges of future small loads mobility.