Goods Movement

Leachman & Associates LLC has developed an economic model to optimize containerized imports from Asia to the United States considering total inventory, handling and transportation costs from the point of view of the importer. Formulas have been developed for required safety stocks at regional distribution centers as a function of the extent of consolidation/deconsolidation activity, demand forecast errors, container flow times and variance of flow times by channel. To support this model, US customs data summarized by PIERS and WTA has been secured, and a database of rates charged by steamship lines and landside carriers and service providers has been developed. This model has been applied to the top 83 US importers of Asian goods as well as to 19 “generic” importers (representing all small importers) to predict the distribution of containerized imports by port and landside channel. When successively applied to all importers, this Supply-Chain Optimization Model enables a Long-Run Elasticity Analysis, predicting overall import container flows by ports and landside channels.

Queuing models also have been developed to predict container flow times through ports, rail terminals and rail line-haul networks as a function of volume, staffing and infrastructure. The Supply-Chain Optimization as above is operated in tandem with the Queuing Models to provide a Short-Run Elasticity Analysis, in which import flows by port and landside channel are predicted as a function of rates, potential fees and potential infrastructure improvements.

The Final Report of the Phase II Port and Modal Elasticity Study (link below) describes application of these models to assess the impact of potential container fees and potential infrastructure improvements in Southern California. The impacts of changes in All-Water Rates via the Panama Canal and of changes in the share of imports by large nation-wide importers also are assessed.


		Port and Modal Elasticity Study				Phase II Port and Modal Elasticity Study