Factors Influencing the Integration of Freight Distribution Networks in the Indonesian Archipelago: A Structural Equation Modeling Approach

Abstract

The main problem of the distribution of freight in archipelago countries such as Indonesia is how to ensure that the outlying and outermost islands are served optimally, with low freight costs and optimal frequency of vessel stops at ports. There are three types of vessels that are subsidized and have the duty of public service obligation (PSO) from the government, namely Sea Tollway, Pelni, and Pioneer shipping. Each vessel has a different route and is not mutually integrated so that its services are not optimal. Integration of the distribution systems of the three types of vessels is needed, thus the distribution costs and the round voyages of vessels are expected to be more optimal and services can be more competitive. The high cost of freight distribution must be minimized so that the government's burden on PSO subsidies can be reduced. This study aims to determine the parameters of the variables that influence the development of an integrated sea transport network model for freight distribution in a region consisting of many islands. The method used was Structural Equation Modeling (SEM) and the variables used were time, cost, freight, port characteristics, vessel characteristics, government policies, and environmental factors (waves and weather). The data used were the results of a questionnaire from 238 respondents, a sample consisting of regulators, shipping operators, academics, and distributors. The results of the conformity testing of the SEM model indicate that all variables have a significant effect on the process of integration of sea transportation networks in the region of the archipelago.

Bi-Level Model on Freight Distribution Network Integration in Archipelagic Region with Milk Run Time Windows and Uncertainty

“…This paper is a continuity from previous research which discovered the factors that affect the integration of sea transport network for freight [29] and research on clustering model of freight distribution system on archipelagic region [30]. Based on those researches, this paper will develop bilevel programming model to resolve the problem on distribution network optimization by observing the affecting factors from those researches.…”

Optimization of the risk-based small-scale LNG supply chain in the Indonesian archipelago

“…The variables used in modeling the LNG supply chain vary widely and include the distance between the receiving terminals [ 9 , 13 , 16 , 18 ], Hub Location [ 13 ], Inventory/storage size [ 13 ], vessel capacity [ 9 , 16 , 18 , 28 , 29 ], generating capacity [ 9 , 18 , 29 ], vessel speed [ 18 , 29 ], transportation costs [ 15 , 18 , 23 , 30 , 31 ], route [ 16 , 28 ], term and length of stay [ 15 ], Capex [ 5 , 15 ], and Opex [ 15 , 23 ]. Meanwhile, the objective function often used is the minimal cost [ 9 , 15 , 18 , 23 , 29 , 32 ], maximum revenue [ 6 , 33 ], and optimal cargo volume [ 16 ].…”

Competitiveness of Traditional Shipping in Sea Transportation Systems Based on Transport Costs: Evidence from Indonesia

“…Guaranteed fast and reliable logistics distribution is a must in the realization of the National Logistics System, which will become the backbone for increasing Indonesia's economic growth [11][12][13]. Traditional shipping, as the lifeblood of sea transportation to inland and isolated areas, is expected to be able to play an active role in the logistics distribution network (spoke) in Indonesia.…”