Horizontal collaboration: opportunities for improved logistics planning

The logistics industry is a critical economic component in most countries and has a significant impact on their citizens' quality of life. In the U.S., 48 million tons of freight valued at more than $46 billion are moved every day and serve 300,000 manufacturing sites, 350,000 warehouses, and 7.5 million businesses. However, the industry is plagued with inefficiencies that can negatively impact corporate profits, the environment, urban congestion, and worker well-being. No single solution will address all of these issues; however, horizontal collaboration appears to offer an opportunity to take a significant step in the right direction. There is an abundance of opportunities for logistics service providers to collaborate, but there is little effective collaboration in practice, and the issues related to this gap remain largely unexplored by academic researchers. This paper offers a review of the existing research in horizontal collaboration, specifically highlighting efforts focussed in the areas of on-demand logistics, freight consolidation, facility sharing, incentives, case studies, and quantitative analyses. A path for pursuing an improved logistics system is offered, and specific research needs in the collaborative logistics field are detailed. We conclude with a discussion of emerging issues that will have immediate impacts on horizontal collaboration efforts.