Exploring the impact of urbanization on consumer goods distribution networks

Abstract

Purpose: Due to the growing percentage share of urban dwellers, the physical distribution of products faces altering conditions. This research explores the effects that urbanization has on the performance of a fast-moving consumer goods distribution network. A focus is set on changes in distribution cost, the cost-minimal network design, and greenhouse gas emissions. Design/methodology/approach: The analyses are based on a quantitative distribution network model of an existing manufacturer of consumer goods. Findings: The results indicate that the foreseen population shift will affect the network's economic and environmental performance. Effects are, among others, due to differences in the efficiency of supplying urban and nonurban regions. The combined effects of urbanization and the development of the population size will even more affect the network's performance. Originality/value: Research dealing with distribution logistics and urbanization primarily focuses on city logistics. In this paper, the object of analysis is the entire distribution system.