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The Impact of GIS/GPS Network Information Systems on the Logistics Distribution Cost of Tobacco Enterprises

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  • Chen, Yan
  • Huang, Zhenhua
  • Ai, Hongshan
  • Guo, Xingkun
  • Luo, Fan

Abstract

The improvement of logistics operation management for many tobacco companies highly depends on the reduction of distribution costs. In order to optimize routes, cigarettes are delivered through online real-time distribution system equipped with GIS/GPS. These network information technologies are crucial to creating and maintaining an efficient distribution system. Considering the applicability and flexibility of GIS/GPS network information system, this paper assesses the impact of its implementation on the logistics distribution cost from both overall and household levels. Specifically, DID and pseudo-DID models were adopted and monthly panel data of 14 prefecture-level branches of Hunan Tobacco Company during 2016-2019 were used for regression.We find that the implementation of GIS/GPS network information systems increased the total distribution cost. However, the average distribution cost was significantly reduced at per household level as the customer base expanded. A series of robustness and sensitivity tests supported above results. Furthermore, the implementation of GIS/GPS network information system is beneficial to service quality and employee performance. In addition, more time and logistics costs were saved when drivers chose “dynamic + fixed optimization” route model.

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  • Chen, Yan & Huang, Zhenhua & Ai, Hongshan & Guo, Xingkun & Luo, Fan, 2021. "The Impact of GIS/GPS Network Information Systems on the Logistics Distribution Cost of Tobacco Enterprises," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 149(C).
    • Handle: RePEc:eee:transe:v:149:y:2021:i:c:s1366554521000739
    DOI: 10.1016/j.tre.2021.102299
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