INTEGRATING A CONSOLIDATION CENTRE WITHIN A DRYPORT FOR

IMPROVED FREIGHT DISTRIBUTION

Dr Marwan AL-Azzawi
URS Scott Wilson Ltd, UK
Ian Mathie
South East of Scotland Transport Partnership (SEStran)
1. INTRODUCTION
The South East Scotland Regional Transport Partnership (SEStran) is one of
7 Regional Transport Partnerships in Scotland. SEStran includes 8 local
authorities within an area of 3,180sq miles and home to 28% of Scotland's
population (www.sestran.gov.uk).
There is a huge diversity of transportation issues within the SEStran area,
from urban congestion to rural transportation and from sea ports to airports,
for both passengers and freight. SEStran is also the main area for Scotland's
financial, economic and Central Government activities and, as such, has a
vital role in the freight and logistics sectors.
The last decade has seen unprecedented growth in freight traffic within and
through the SEStran area which has led to a number of significant impacts
and associated pressures on the transport network. Many towns and cities
within SEStran experience significant congestion at certain times of the day,
which impacts on both businesses and residents.
SEStran aims to address these issues and work towards a more sustainable
and efficient transport network. One of the initiatives being examined by
SEStran is the potential for Consolidation Centres strategically located in its
area to improve freight deliveries to key locations and reduce the impacts of
air pollution, congestion and noise.
However, experience from elsewhere suggests that Consolidation Centres
seem to be most feasible when they can provide a range of services or are
part of other freight activities at a particular location. This allows for
economies of scale in operations, integration with different modes and
bundling together of deliveries from several shippers for one destination. The
idea of incorporating a Consolidation Centre within another freight hub raises
interesting possibilities.
To that end, SEStran commissioned URS Scott Wilson Ltd to investigate the
potential for integrating a Consolidation Centre within a Dryport facility to
serve the South East of Scotland and integrate road, rail and sea modes,
allowing more choice and improved freight distribution.
This paper presents the results of this major piece of research, comparing six
different Consolidation Centres implemented elsewhere in Europe, evaluating
their effectiveness and summarising the lessons that were learned.

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2. STUDY OBJECTIVES
2.1

Aim

SEStran had identified key elements of the Freight Action Plan that impacted
on the location and operation of a Dryport. These specifically focussed on the
potential role of Consolidation Centres in the SEStran area and the part they
could play in the potential development of Dryports. To this end the aims of
the study were to:

identify the potential demand and benefits of providing Consolidation

Centre activities to the SEStran area; and

identify the economic benefits of combining the Consolidation Centre

operation as part of a potential Dryport facility.
2.2

Scottish Project Vision

SEStran have been working with the Transport Research Institute (TRI) of
Napier University, Edinburgh, to develop further the concept of Consolidation
Centres operating within the Dryport context. This will enable the delivery of
some of the Regional Transport Strategy objectives and also address the
following key issues:

Assist the development of sustainable and integrated freight movements

to and from Scotland;

Influence the development of transport proposals that will enhance

Scotlands economic competitiveness; and

Establish a Scottish Intermodal Gateway Network (SIGN).

2.3

Scottish Project Progress

The approach taken by SEStran involved dividing the project into key
workstreams with the following elements:

identifying potential demand for a Consolidation Centre in terms of both

the facility itself and its location;
identifying current and future freight movements to and from the SEStran
area, within Scotland and that associated with cross-border and
international trade; and
examining existing infrastructure and services relating to freight
movements, existing freight hub services and the potential for
improvement;
identifying potential sites for a Consolidation Centre that may also be
suitable for a Dryport and that efficiently meshes with the existing
transport distribution network;
understanding the issues and identifying solutions; and
some initial findings on the above were presented at last years
European Transport Conference and also at the Dyports Conference
organised by SEStran and Napier University Transport Research Institute
(TRI).

Association for European Transport and Contributors 2011

3.
3.1

CONSOLIDATION CENTRES AND DRYPORTS

How do Consolidation Centres Work?

Consolidation Centres operate along similar lines irrespective of the sector

they serve. Retailers and contractors place orders for their goods and
materials with their suppliers, but instruct that the delivery is made to the
Consolidation Centre and not to the business or site as is normally the case.
The delivery order is then placed with the Consolidation Centre for the
supplies ordered. This is assembled at the Consolidation Centre and delivered
from there.
Delivery to the recipient sites may involve the consolidation of numerous
businesses orders onto each vehicle. Deliveries are normally decanted from
lorries onto smaller vans to negotiate traffic and loading/unloading conditions
with greater speed and flexibility in an urban environment. Consolidated cargo
can be delivered using environmentally friendly vehicles.
A relatively high proportion of all the deliveries requested from the
Consolidation Centre are required with less than 24 hours notice (i.e. on a
just-in-time basis). This level of service would be difficult to achieve if
deliveries made directly to site by suppliers.
Consolidation Centres also may provide a variety of value-added services
including, but not limited to collection services, label printing, stock room
management and staff training facilities.
Figure 1 below shows the basic operation of a Consolidation Centre.
Figure 1 Basic Operation of a Consolidation Centre

3.2

Case Studies

Six examples of freight consolidation centres have been reviewed, focussing

on their efficiency, sustainability, and their effects in terms of freight transport
impacts on the supply chain. The six examples we have reviewed which
provide the range and depth of information required are as follows:

Bristol Consolidation Centre;

Meadowhall Consolidation Centre;
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London Construction Consolidation Centre;

Heathrow Airport Consolidation Centre;
Monaco Consolidation Centre; and
Stockholm Hammarby Consolidation Centre.

The main findings from the case studies are presented in Appendix A and
summarised in Table 1 below.
Table 1 Consolidation Centre Case Studies
Case Study

Comments

retail sector located in south west England, covers an area of 500 sq.
Bristol
Centre

Consolidation

Meadowhall
Consolidation Centre

London Construction
Consolidation Centre

Heathrow
Airport
Consolidation Centre

Monaco Consolidation
Centre

m., currently active, operating on an optional basis some 400 m. from

locations served
privately operated services offered are cargo consolidation, delivery
when required plus value added services
benefits include fewer vehicle trips, related environmental savings
including noise & air pollution and delivery time savings for clients
retail sector located in northern England, covers an area of 2,500 sq.
m., currently active, operating on an optional basis some 10 miles from
locations served
privately operated services offered are cargo consolidation, delivery
when required plus value added services
benefits include fewer vehicle trips, related environmental savings
including noise & air pollution, increased turnover & reduced staffing
costs for clients
construction sector located in the Capital, covered an area of 5,000
sq. m., currently closed, operated on an optional basis some 3 miles
from locations served
privately operated services offered were cargo consolidation, delivery
when required plus short term storage
benefits include reduced freight vehicle trips and greater control over
vehicle sizes entering the city centre
retail sector located at principal national airport, covers an area of
2,300 sq. m., currently active, operating on an optional basis some 10
miles from locations served
privately operated services offered are cargo consolidation, delivery
when required plus value added services
benefits include reduced freight vehicle trips, related environmental
savings, delivery time savings and vehicle fuel savings for clients
retail & construction sector located in Southern Europe, covers an
area of 1,300 sq. m., currently active, operating on a compulsory basis
adjacent to locations served
privately operated services offered are cargo consolidation, delivery
when required plus value added services
benefits include reduced freight vehicle trips, vehicle area required for
deliveries, related environmental savings and vehicle fuel savings for
clients

construction sector located in Northern Europe, covered an area of

Stockholm Hammarby
Consolidation Centre

7,500 sq. m., currently closed, operated on a compulsory basis adjacent

to location served
privately operated services offered were cargo consolidation, delivery
when required plus short term storage
benefits include reduced freight vehicle trips, improved vehicle load
factors, related environmental savings, delivery time savings for clients
and reduced property theft
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3.3

Consolidation Centre Activities

From the Case Studies and our investigations the following activities have
been identified which are carried out at a Consolidation Centre, as shown in
Figure 2 below.
Figure 2 Consolidation Centre Operations
Collection Services

Label Printing

Cross
Docking

Storage

Consolidation
Centre

Pre-retailing

Stock Room
Management

Delivery
Consolidation

Replenishment
Staff Training
Facilities

The Figure illustrates the main operations and responsibilities undertaken by a

Consolidation Centre shown as the dark blue boxes, and the light blue
boxes show additional operations some Consolidation Centres may undertake
as value added activities. These value added services which may be offered
at the consolidation centre allow retailers and other users of the facility to pick
and choose the services that suit their needs.
3.4

Dryport

Dryports are intermodal facilities that are located inland and which connect the
rail and road network with sea ports in the region. They allow the movement of
containers between modes and can help shift freight from road to rail and sea
options. Furthermore, they can assist in relieving congestion at sea ports and
provide these ports with support functions.
Dryports can operate 24 hours a day in the transhipment of Twenty-foot
Equivalent Units (TEUs). Essentially they can carry out all the functions and
value added services of a sea port used for the shipping and forwarding of
cargoes. These functions include customs clearance, storage, information
exchange etc. These functions can save time and space at sea ports and
reduce loading times.
3.5

Combining a Consolidation with a Dryport Facility

The placement of a Consolidation Centre within a Dryport facility would have

an impact on the actual design and layout of both the Consolidation Centre
and Dryport and would be specific to each individual location depending on
several factors including traffic volume, traffic pattern, special trade
requirements and conditions.
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In the absence of a definitive Consolidation or Dryport layout design, several

assumptions were made as to the actual layout, based on best practice. For
the purposes of this research, it was assumed that such a combined facility
serving south east Scotland could have a capacity of up to 150,000 TEUs per
annum.
An operating plan for integrating a Consolidation Centre within a Dryport was
developed, indicating how the different freight sectors would be served. This
showed how it is possible for a Dryport and a Consolidation Centre to work
together on the same site. The potential method of operation extended to the
activities at a Dryport and how they would be slightly adapted to
accommodate a Consolidation Centre in terms of staffing arrangements,
management structure and operations. The findings also displayed the
potential savings in operating costs due to improved economies of scale.
Figure 3 below shows the general layout and important components of a rail
based Consolidation Centre combined with a Dryport.

ADMIN.
BUILDING &
CONTROL
CENTRE

CONSOLIDATION
CENTRE

CUSTOMS
WORKSHOP &
CONTAINER
REPAIR AREA

GATE

VEHICLE
WAITING AREA

CFS

LOADED CONTAINER STORAGE AREA

EMPTY CONTAINER
STORAGE AREA

TRAIN LOADING/UNLOADING AREA

GATE

CONTAINER
TRANSFER
ROAD/RAIL

GATE

SPECIALISED
CONTAINERS

Figure 3 General Layout of a Combined Consolidation Centre - Dryport

The layout as presented in this example assists in minimising and possibly
eliminating the amount of time required for freight vehicles to operate within
the stacking and loading area. All movements of containers and other cargos
within the facility can be undertaken by dedicated handling vehicles such as
forklifts, mobile cranes and in the case of the rail line, gantry cranes. This
layout adds to the efficiency and safety of the operation of such a facility, and
can be extended to other activities such as aggregating loads undertaken
within the combined facility.

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3.6

Management Arrangements

In order to manage a combined Consolidation - Dryport facility a highly

organised management structure must be employed to ensure the facility
operates smoothly. Figure 4 provides an overview of this management
structure.
Figure 4 Combined Consolidation Centre - Dryport Management Structure
Controlling Body

General Manager

Security

Storage

Operations

Pre-retailing

Engineering

Replenishment

Customs

Accounts

Marketing

Cross
Docking

Maintenance
& Repair

Consolidation

Yard

The controlling body of the Consolidation Centre (as part of and/or separate
from a Dryport facility) can vary between publicly run and privately owned
sites, depending upon the local conditions and circumstances. The controlling
body is usually responsible for creating the management structure appropriate
to the size of the facility and setting and monitoring objectives for successful
management of the facility. The controlling body usually appoints a general
manager to oversee the day-to-day running.
The general manager controls the overall site and is responsible for staff as
well as operations. It is therefore important that the general manager has
experience of recruiting staff as well as operations. They are also responsible
for building the commercial links with the retail sector, hauliers, construction
companies as well as railway companies, shipping companies and the
relevant authorities.
The size and operations of the facility will dictate the number of staff required
at the next level although each of the five sectors will have a manager
responsible for overseeing the running of that sector. It is likely that the Head
of Operations will be the next most senior to the general manager, overseeing
the handling of the cargo and communicating with the relevant parties to keep
them informed of progress.
3.7

Location for a Potential Consolidation Centre

A stakeholder consultation was undertaken but restricted to only a small

number of key stakeholders. The survey was based on a limited number of
targeted telephone interviews with businesses and organisations that had
been identified early in the commission. The intention was to attain a deeper
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Railhead

understanding of the main issues from a more detailed discussion than a

superficial familiarity of these drawn from a large number of interviews based
on high-level questions. In addition, the mixture of qualitative and quantitative
information encouraged respondents to raise issues important to them, but
which might otherwise have been overlooked.
The diversity of respondents from the consultation undertaken ensured that
the preferred location of Consolidation Centre would vary. Nevertheless, the
preferred locus for such a facility was formed by a triangle linking Eurocentral
(Mossend area) / Coatbridge area in the south west, to the Falkirk
Grangemouth region, and eastwards encompassing Livingston and the
western fringes of Edinburgh.
Within this preferred region, the location favoured by the retail sector in
particular would be close to Livingston, which would have an advantage in
terms of time and distance over the Falkirk Grangemouth area serving the
Edinburgh Lothian Fife region. In contrast, the construction industry is
more site specific being dependent on the location of the major construction
sites and the (often strict) client requirements associated with these. In
general, Grangemouth was the preferred location for this sector, as it is
central to the region and close to a major port that can be used for importing
materials.
In addition to the consultation exercise, a number of sites were identified from
previous studies, notably the SEStran Freight Routing Study (FRS) and the
Scottish Multi-Modal Freight Locations Study (part of the Governments
Freight Action Plan). Together with the sites identified in the consultation,
these were:

Leven/Methil Dock
Rosyth
Grangemouth/Falkirk
Coatbridge
Lockerbie
Livingston

4.

SCENARIO TESTING

The scenario testing was undertaken on both the sites that had been identified
through the stakeholder consultations which had targeted the relevant
businesses and organisations, and those identified from previous studies,
most notably the Scottish Multi-Modal Freight Locations Study.
4.1

Demand Analysis

A cordoned out version of the Freight Model for Scotland (FM4S) was used for
this analysis. Details of the FM4S were presented in previous submission to
the ETC1, so this has not been discussed in depth here. However, the FM4S
is essentially a strategic model, so the model was which was subsequently
further refined at a local level based on a standard Incremental Elasticity
1

Enhanced cross-sectional models, Institute for Transport Studies, Leeds University, 1999

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Model2 (IEM) in order to cover key points of interest, most particularly the
likely location of a consolidation centre serving the appropriate area.
In order to assess the changes of freight movements in the future, these were
characterised as retail and construction movements. Two scenarios were
adopted reflecting low and high freight growth rates, both for trips ending in
the southeast of Scotland and for those destinations elsewhere but which
passed through the area. Forecast freight movements were then presented
both at the local authority level and for each Scottish Regional Transport
Partnership (RTP) region.
The IEM used the estimates of freight transferred to the consolidation centre
from the FM4S. From the base journey times and distances derived from the
model, HGV-kilometres and HGV-hours savings were calculated representing
the monetised value of benefits using standard Government measures. These
included both time and vehicle operating cost (VOC) savings for each location
for which a consolidation centre had been identified.
4.2

Potential Locations Identified

The result of the demand analysis cropped the number of original sites, six,
that had been identified and were shown in Section 3.7, down to three which
have been shown to be suitable following this analysis. These were:

Grangemouth/Falkirk
Coatbridge
Livingston

The results of the demand analysis on these three locations are shown in
Tables 2 below and 3 overleaf, for both retail and construction freight and for
the low growth and high growth assumptions. These show the changes in
vehicle-kilometres (veh-kms) and vehicle-hours (veh-hrs). A negative value
indicates an increase, as where the use of a consolidation centre can lead to
an increase in journey times and/or distances for some OD movements.
Table 2 Network-wide Impact of the Consolidation Centre Options (Annual
Values for Retail Freight

Transferred Tonnage
HGV
Equivalent
Removed
Veh-km Savings
Veh-hour Savings

Transferred Tonnage
HGV
Equivalent
Removed
Veh-km Savings
Veh-hour Savings
2

2020 Low Growth

Livingston
Grangemouth/Falkirk
73,660
73,602
4,695

4,691

15,246
438

15,058
260
2020 High Growth
Livingston
Grangemouth/Falkirk
83,849
83,783

Coatbridge
72,334
4,610
-1,801
345
Coatbridge
82,338

5,344

5,340

5,248

17,353
499

17,146
295

-1,885
395

http://etcproceedings.org/paper/a-freight-transport-model-for-scotland (published in 2010)

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Table 3 Network-wide Impact of the Consolidation Centre Options (Annual

Values for Construction Freight

Transferred Tonnage
HGV
Equivalent
Removed
Veh-km Savings
Veh-hour Savings

Transferred Tonnage
HGV
Equivalent
Removed
Veh-km Savings
Veh-hour Savings

2020 Low Growth

Livingston
Grangemouth/Falkirk
215,227
210,318
13,346

Coatbridge
208,663

13,041

12,939

-33,520
33

-30,723
-221
2020 High Growth
Livingston
Grangemouth/Falkirk
238,576
233,184

-216,705
-1,561
Coatbridge
231,360

14,794

14,459

14,346

-35,092
56

-33,597
-242

-240,627
-1,730

The above tables suggest all three sites return similar results in terms of
tonnage (and HGV equivalent) passing through the consolidation centre, with
Livingston performing slightly better.
However, results differ in terms of vehicle-kilometres and vehicle-hours
savings. For retail freight, Livingston gives the best results, followed by
Grangemouth/Falkirk. Coatbridge actually leads to a slight increase in vehiclekilometres, due to this site being further away from southeast Scotland and
therefore more distant from the main attractors in the this area. For
construction freight, all three sites lead to an increase in vehicle-kilometres,
particularly Coatbridge which also leads to an increase in vehicle-hours.
4.3

Economic Analysis Results

The economic appraisal method adopted is based on a Restricted Cost /

Benefit Analysis (RCBA). The evaluation involves comparing estimated
revenues and some other benefits (time savings, VOC reduction, reduction in
sensitive lorry miles and carbon savings) against capital and operating costs.
The aim is to identify those location options which support sustainable
economic activity and return good value-for-money.
The results of the RCBA appraisal on monetised benefits and costs are
summarised in Tables 4 and 5 overleaf. From these, it was possible to gain an
insight into the relative economic efficiency of the options.
Table 4 Summary of Appraisal Results (Retail Freight)
2020 Low Growth
Livingston Gram/Falk Coatbridge
Present Value Benefits
(PVB)
Present Value Costs
(PVC)
Net Present Value (NPV)
Benefit/Cost Ratio (BCR)
Revenue / OpEx Cost
(R/O)

2020 High Growth

Livingston Gram/Falk Coatbridge

4.61m

4.54m

4.07m

5.90m

5.81m

5.21m

6.09m

6.09m

6.09m

6.09m

6.09m

6.09m

-1.48m
0.76

-1.55m
0.74

-2.03m
0.67

-0.19m
0.97

-0.29m
0.95

-0.89m
0.85

0.82

0.82

0.80

1.05

1.05

1.03

Note: all monetary values discounted to 2002 prices

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Table 5 Summary of Appraisal Results (Construction Freight)

2020 Low Growth
Livingston Gram/Falk Coatbridge
Present Value of Benefits
(PVB)
Present Value of Costs
(PVC)
Net Present Value (NPV)
Benefit/Cost Ratio (BCR)
Revenue / OpEx
Cost (R/O)

2020 High Growth

Livingston Gram/Falk Coatbridge

7.92m

7.70m

2.47m

9.41m

9.10m

2.91m

6.09m

6.09m

6.09m

6.09m

6.09m

6.09m

1.83m
1.30

1.61m
1.26

-3.62m
0.41

3.31m
1.54

3.01m
1.49

-3.19m
0.48

1.76

1.72

1.71

2.08

2.03

2.02

Note: all monetary values discounted to 2002 prices

The RCBA Appraisal results show the relative performance of the tested
options in terms of the Benefit-to-Cost Ratio (BCR) and Net Present Value
(NPV). The Tables show that the consolidation centre in Livingston presents
the highest BCR value, and offers the best returns to investment for both retail
and construction freight, although the BCR for retail is just below 1.
The results for the Grangemouth/Falkirk consolidation centre are slightly
lower, and the Coatbridge consolidation centre returns the lowest BCR, due to
the fact that it leads to significant increases in journey distances and times.
For all the locations the NPVs and BCRs are either lower for retail than for
construction freight or are in negative territory, suggesting that consolidation
centres for the retail market are more likely to necessitate public subsidies.
There is a possibility to generate some synergies by establishing a Dryport
and a consolidation centre on the same site, thereby potentially decreasing
costs and augmenting benefits. A clear gain from having both facilities
operating jointly would be the sharing of the management structure. Moreover,
both the container freight station (CFS) within the Dryport and the
consolidation centre could be managed by the same staff, which would lead to
a reduction in operating costs.
It should be noted that both Grangemouth/Falkirk and Coatbridge were on the
original list as potential Dryport sites in the Freight Routing Study, and these
locations were also identified in the Scottish Multi-Modal Freight Locations
Study. Although Livingston was not identified in these studies, it was
acknowledged that Livingston generates the highest network benefits as a
consolidation centre. It was therefore suggested to assess Livingston as a
Dryport location, in order to compare effectively the potential costs and
benefits of combining a consolidation centre and a Dryport in all three
locations.
In order to estimate the costs savings a restricted cost/benefit analysis
(RCBA) was carried out for a consolidation centre as part of a Dryport. The
RCBA model used was the same as that used above. Based on case studies,
potential staff savings were identified which gave an average of circa 20%
reduction in operating costs.
The results of the adjusted RCBA for a combined consolidation centre Dryport
facility, for both retail and construction freight, are shown below in Tables 6
and 7 overleaf.
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Table 6 Summary of Appraisal Results Combined Consolidation Centre

Dryport Facility (Retail Freight)
2020 Low Growth
Livingston Gram/Falk Coatbridge
Present Value of
Benefits (PVB)
Present Value of
Costs (PVC)
Net Present Value
(NPV)
Benefit / Cost Ratio
(BCR)
Revenue / Operating
Cost (R/O)

2020 High Growth

Livingston Gram/Falk Coatbridge

4.61m

4.54m

4.07m

5.90m

5.81m

5.21m

5.10m

5.10m

5.10m

5.10m

5.10m

5.10m

-0.49m

-0.56m

-1.03m

0.80m

0.71m

0.11m

0.90

0.89

0.80

1.16

1.14

1.02

1.02

1.02

1.01

1.31

1.31

1.29

Note: all monetary values discounted to 2002 prices

Table 7 Summary of Appraisal Results Combined Consolidation Centre

Dryport Facility (Construction Freight)
2020 Low Growth
Livingston Gram/Falk Coatbridge
Present Value of
Benefits (PVB)
Present Value of
Costs (PVC)
Net Present Value
(NPV)
Benefit / Cost Ratio
(BCR)

2020 High Growth

Livingston Gram/Falk Coatbridge

7.92m

7.70m

2.47m

9.41m

9.10m

2.91m

5.10m

5.10m

5.10m

5.10m

5.10m

5.10m

2.82m

2.60m

-2.63m

4.30m

4.00m

-2.19m

1.55

1.51

0.48

1.84

1.78

0.57

2.14

2.60

2.54

2.52

Revenue / Operating
2.21
2.16
Cost (R/O)
Note: all monetary values discounted to 2002 prices

The results above indicate that the savings in operating costs lead to an
average 20% increase of the BCR and a 25% increase in R/O. As a result, the
freight consolidation centres at Livingston and Grangemouth/Falkirk return a
positive NPV in the high growth scenario.
5.

EMERGING FINDINGS AND LESSONS LEARNED

5.1

Strategic Benefits for a combined Consolidation Centre /

Dryport Facility

From the study there is clearly potential for a combined consolidation and
Dryport within central Scotland. There is no doubt, with the sharing of certain
operations over the two kinds of facility, potential significant gains in
economies of scale, with the result of perhaps circa 20% reduction in overall
costs.
Furthermore, it should be noted that the establishment of a Consolidation
Centre within the context of a Dryport in the southeast of Scotland region
could, in addition to realising savings in operational costs help to meet
broader government objectives such as modal shift and greenhouse gas
reductions. The analysis of the network-wide benefits from the study
demonstrated that there are larger beneficial impacts when a consolidation
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centre is combined with a Dryport. The resultant monetised economic savings

are sufficiently large enough to cover operating costs as well as provide a
positive Benefit / Cost Ratio (BCR), for the locations in the south east of
Scotland examined in this research.
5.2

Geographical Locations for Scotland

Based on the network benefits analysis and the Dryport/consolidation centre

economic analysis undertaken for the sites examined in this study, it is clear
that Livingston returns the best results for a consolidation centre, particularly
for construction freight. However, it is less than ideal for a Dryport due to its
insufficient demand and lower accessibility to rail freight.
On the other hand Coatbridge appears to be the best location for a Dryport
because of its good connections to the rest of Scotland and its status as a
major rail facility. However, its location outside the southeast of Scotland
makes it less suitable for a consolidation centre servicing this area as it leads
to significant increases in journey times and distances on road, particularly for
construction freight.
Lastly, Grangemouth/Falkirk returns a slightly lower NPV than Livingston for a
consolidation centre, but results are still positive. It comes second as a
Dryport site as well, due to its proximity to the port of Grangemouth and its
good accessibility by rail.
5.3

Contradicting Markets

From the findings in section 5.2, it is clear the market for a consolidation
centre is different from that of a Dryport and hence the two are not necessarily
compatible. There might be situations and locations elsewhere when both
markets are complimentary but unfortunately this is not the case in the south
east of Scotland, and arguably also in the rest of the Scottish central belt and
the rest of Scotland. An important lesson to learn is that particular care will be
needed when combining a consolidation centre (a local freight initiative) with a
strategic freight project like a Dryport.
However, if a stand alone consolidation centre was to be pursued then it can
be concluded that the best location for such a facility servicing the south east
of Scotland would be Livingston, particularly for construction freight.
5.4

Sensitivity of the Construction Sector

The location of a consolidation centre would need to be balanced with care as

the greatest demand would seem to be from the construction industry.
However the construction industry is, but its very nature, transient, and
therefore the performance of a fixed facility would be expected to change over
time.
With a combined Consolidation Centre / Dryport facility this sensitivity to
location is reduced as this becomes less sector specific and more importance
is placed on synchronising connectivity and operations between this facility
Association for European Transport and Contributors 2011

with other major facilities in the area, in particular regional ports and harbours.
5.5

Key Performance Indicators

There are a number of key performance indicators (KPIs) which can be

gleaned from the Case Studies examined in this research. These can be
applied to other potential locations. Table 8 below shows some of the KPIs
identified in this study for both the retail and construction industries.
Table 8 KPIs from the Case Studies
KPI
Size of Consolidation Centre
Staff Level
Traffic Benefits
Environmental Benefits
Commercial Benefits

Operating Costs

Consolidation Centre
Operator

Outcome
Range from 500sqm to 5,000sqm
Range from 6 to 20 FTE staff
Range from 42% to 75% reduction in
delivery vehicle movements
Range from 26% to 75% reduction of
CO2 emissions for deliveries
Up to 15% reduction of materials waste
Saving in fuel bills per supplier
Retailers typically saving up to 20
minutes per delivery
Up to 10% increases in sales turnover
reported by retailer
Range from 90,000 to 459,000 (at
2007 prices) depending on the size of the
operations
All case studies were owned or operated
by private companies

All other things being equal, the principles behind these order-of-magnitude
outcomes may be universally applicable although actual parameters may, of
course, be different for specific areas and operating characteristics and care
will be needed in their application.

Disclaimer
The views expressed in this paper are those of the authors alone and do not
necessarily represent any views expressed by SEStran and/or URS Scott
Wilson Ltd.

Association for European Transport and Contributors 2011

Appendix A Key characteristics & Performance of Case Studies

Bristol
Sheffield
Case Study
London
(Broadmead)
(Meadowhall)
Location
UK
UK
UK
Sector
Retail
Retail
Construction
Status
Active
Active
Closed
Terms of use
Optional
Optional
Optional
Distance from
location
10 miles
400 metres
3 miles
served
Size

500 sq. m

2,500 sq. m.

UK
Retail
Active
Optional

Overseas
All
Active
Compulsory

Stockholm
(Hammarby)
Overseas
Construction
Closed
Compulsory

10 miles

Adjacent to area
served

Adjacent to
construction site

2,300 sq. m.

1,300 sq. m.

3,500 sq. m
inside and 4,000
sq. m. outside

Reduce traffic
congestion and
vehicle emissions

Reduce traffic
congestion and
disruption

Reduce traffic
congestion and
disruption

Reduce traffic
congestion &
emissions

Consolidation,
delivery when
required plus short
term storage

Consolidation,
delivery when
required plus
value added
services

Consolidation,
delivery when
required plus
value added
services

Consolidation,
delivery when
required plus
short term
storage

5,000 sq. m.

Heathrow Airport

Monaco

Main
Objectives

Reduce
congestion and
related emissions

Services
offered

Consolidation,
delivery when
required plus
value added
services

Reduce operating
costs, improve
sales and reduce
loss/theft
Consolidation,
delivery when
required plus
value added
services

Consolidation
Centre
operator

Private company

Private company

Private company

Private company

Private company

Private company

Staff level

Staffing
information
unavailable

6 staff plus extra

staff at peaks as
needed

16 staff

20 staff

8 staff

10 staff

Association for European Transport and Contributors 2011

Case Study

Bristol
(Broadmead)

Sheffield
(Meadowhall)

Traffic
benefits

75% reduction
in delivery
vehicle
movements for
participating
retailers
6,945 fewer
vehicle trips
Saving of
178,000
vehicle
kilometres

Reduced the
number of
vehicles
delivering to
shopping centre
but not
quantified

Environmental
benefits

Savings of:
20.3 tonnes of
CO2
660 kg of NOx

Reported that
consolidation
centre reduces
vehicle

London

Heathrow Airport

68% reduction in
construction
vehicles for
deliveries to
sites served by
consolidation
centre
Better control
over sizes of
vehicles entering
City of London

66% reduction
in the number of
vehicle
movements to
airport terminals

Approx. 75%
reduction of CO2
emissions for
deliveries from

Reported savings
consist of:
22 tonnes of
CO2 per year

Monaco

38% reduction
in traffic
congestion
42% reduction
in space used
by vehicles for
deliveries

Reductions for
deliveries from
consolidation
centre to site of:

Stockholm
(Hammarby)
Vehicle load
factor
improved from
approx. 50% to
85%
Vehicle
kilometres per
day reduced
from 64 km to
26 km
Vehicle
delivery time
reduced from
approx. 60
minutes to 6
minutes
The 80%
reduction in
small volume,
direct
deliveries was
achieved only
at peak times
Reductions for
deliveries from
consolidation
centre to site of:

Association for European Transport and Contributors 2011

Case Study

Commercial
benefits

Bristol
(Broadmead)
19.7 kg of
PM10
12.9 tonnes of
cardboard and
plastic
collected and
recycled

Sheffield
(Meadowhall)
movements to
store thereby
helping to reduce
pollution in
surrounding area

100% on-time
Up to 10%
deliveries
increases in
sales turnover
No reports of
reported by
losses or
retailers
damage to
stock
Reduced
staffing costs
Retailers
typically saving One retailer
more than 20
reduced store
minutes per
refit time by two
delivery
days and
reduced impact
38% of
of lost sales
retailers can

London
consolidation
centre to sites

120 minutes
average
reduction in
journey time for
contractors
Up to 15%
reduction of
materials waste
- reduced
damage, less
shrinkage
97% delivery
reliability

Heathrow Airport
70 kg of carbon
monoxide per
year
197kg of NO2
per year
14.5kg of
particulates per
year

A saving of up
to 5000 in fuel
bills per
supplier per
annum
Time savings of
up to 250k per
annum

Monaco
26% in fuel
consumption
25% in NOX
35% in CO
26% in SO2
26% in CO2
30% in local
atmospheric
pollution
30% in vehicle
noise pollution

Not covered in
scheme
reporting but
improved
efficiency of
goods
distribution is an
objective of
consolidation
centre

Stockholm
(Hammarby)
90% in energy
use
90% in CO2
emissions
90% in NOx
90% in PM
55 dB(A)
exceeded 260
times/day
compared with
360 times/day
without
consolidation
centre
Instrumental in
achieving ontime
completion of
new buildings
Fewer
problems than
normal with
damaged or
stolen goods.

Association for European Transport and Contributors 2011

Case Study

Bristol
(Broadmead)
spend more
time with
customers
45% of
retailers say
improved staff
morale
94% of
retailers would
recommend
FCC to other
retailers

Sheffield
(Meadowhall)

London

Heathrow Airport

Monaco

Stockholm
(Hammarby)

Total operating
costs 412,000
euros (direct
subsidy of
86,000 euros
received).
Estimated to be
115,000 euros in
2007 prices.

Total budget for

the 5-year project
2m. EU funding
0.28m

Operating costs
were 20% public:
80% private.

Operating costs 40% public : 60%

private

Increased
productivity of
labour force by
up to 30
mins/day
(potentially
allowing a 6%
reduction in
labour force
required)

Cost

Operating cost in
2007/8 459,000

Not available
commercially
confidential

Total project cost

3.2 million

Public /
private
funding ratio

Operating costs 62% public : 38%

private

Capital and
operating costs 100% private

Capital and
operating costs 58% public : 42%
private

Five-year contract
worth 2 million
per year

Information not
available

Association for European Transport and Contributors 2011