The Physical Internet (PI) is an open global logistics system founded on
physical, digital and operational interconnectivity through encapsulation, interfaces and protocols.
The CELDi Physical Internet Project is focused on determining the impact of standard container sizes and optimized distribution networks on the supply chain.
The Physical Internet (PI) is envisioned as a new paradigm for interconnected logistics systems, building on the recent success of horizontal collaboration projects. As part of a two-year research project funded by the U.S. National Science Foundation and eighteen thought leader organizations, we have developed models to quantify the effects on sustainability and profits as organizations shift to interconnected logistics systems. Our results indicate that the PI represents a "win-win-win" virtuous cycle with the business models of shippers, receivers and transportation service providers all benefiting from the PI in terms of increased profit margins and smaller environmental footprints. In addition, the transportation network that is anticipated to emerge would lead to strategic impacts on network design, customer service and the ability to significantly reduce the perennial driver shortage issue through reduced driver turnover. In addition to presenting business briefs for the principal PI participants, we also present possible paths forward, including a call for action in terms of focused pilot studies co-funded by shippers, receivers, and providers.
link to report
The Thought Leaders participating in the CELDi Physical Internet Project are a group of professionals from various sectors of industry including retailers and other distributors, suppliers, transportation providers, technology providers, as well as leading trade associations. The companies represented include: Air Liquide, American Transportation Research Institute, Boeing, CHEP, Hewlett Packard, J.B. Hunt, Johnson Controls, Leggett & Platt, Menasha, Millwood, Procter and Gamble, RedPrairie, SC Johnson, Tompkins International, Volvo Logistics North America, Walgreens, and Walmart. Supporting organizations include the Material Handling Industry of America and the National Science Foundation.
The Physical Internet offers the potential for substantial improvements in freight transportation. As the adoption of the PI increases, more loads are available for sharing among transportation service providers. This leads to more fully loaded trailers that travel fewer miles, thus reducing the cost per load on average. In this study, we analyze the freight transportation improvements for key performance measures as adoption of the PI increases.
One key aspect of the Physical Internet (PI) is the use of a shared-asset logistics network. The use of such a network will have an impact on the distances traveled for goods as they flow through the supply chain as well as the inventory held at various points along the supply chain. Therefore, a key open question is what impact would a dense, shared-asset network have on the inventory in the system and the distances traveled? Using data consistent with a consumer packaged goods (CPG) to retailer supply chain, our results show that distances will decrease and inventory will change.
In the Physical Internet (PI), relay networks will likely emerge as part of the overall transportation network organization. A relay network is configured with trailers being passed driver-to-driver, relay style, until reaching their destination. Loads will be transported more quickly, which will increase customer service. Long-haul transportation service providers will be able to get drivers home more often, potentially improving drivers' lives and reducing driver turnover. Implementing a relay network system would also affect miles traveled and CO2 emissions. In this study, we quantify these impacts.
link to full paper
In the Physical Internet (PI), relay networks will likely emerge as part of the overall transportation network organization. Such networks will enable long-haul transportation service providers to get their drivers home each night. If drivers return home each night and sleeper cabs are no longer needed, removing sleeper cabs (the driver's home away from home) has the potential to reduce costs and CO2 emissions. In this study, we quantify these impacts and others and find that they are significant.
One key aspect of the Physical Internet (PI) is the use of standardized, modular containers that enable the coordination of shipments across the supply chain. However, a key open question is how will limiting the choice of container sizes impact the amount of volume that is shipped? Using data from a consumer packaged goods company, our results show that standardized modular containers actually save space in the trailer.
The CELDi Physical Internet Project website is organized as follows:PI-Enabling Concepts include three initiatives that are closely related to the CELDi Physical Internet Project, as well as technologies, concepts and organizations found by our Thought Leaders. Container Sizing includes information related to packaging metrics, industry standards, and package sizing. Collaborative Distribution identifies companies, tools and case studies that demonstrate how collaboration can facilitate efficient distribution. Cloud Decision Making lists examples of software that provide decision support via cloud computing. Freight Studies contains links to videos and publications related to freight movement. Organizations provides information about professional organizations that allow networking opportunities and offers resources that promote supply chain best practices. Contacts lists the CELDi PI team leaders and the organizations involved in the CELDi PI Project.
To see an animated slide show that demonstrates the potential gains of the Physical Internet, click the link below. (The slide show is automated and lasts approximately 3½ minutes.)
The CELDi Physical Internet Project is part of a broader, international initiative with research teams from Canada, France, Germany and Switzerland. The objective of the Physical Internet Initiative is to globally transform the way physical objects are handled, realized, supplied and used.
The Center for Excellence in Logistics and Distribution is an applied research and education consortium consisting of nine major research universities, more than 30 member organizations and the National Science Foundation (NSF/UCRC). The mission of CELDi is to enable member organizations to achieve logistics and distribution excellence by delivering meaningful, innovative and implementable solutions that provide a return on investment.