Consumer product prices are rising due to increased fuel and transport costs. Instead of trying to pass this increasing cost to consumers, manufacturers should try to collaborate and be more responsible to make their logistics processes more efficient. The CO³ Project will build upon this new trend of improving efficiency in transport through collaboration.
Statistics show that many freight vehicles are running empty and that the rest are partially filled to their weight capacity. An innovative solution to drastically increase the capacity utilization of the European freight transport system is collaborative transport: "carpooling for cargo". This will allow the transport sector to become more sustainable, in terms of economic, environmental, and social benefits. This mental shift is the idea behind the CO³ Project.
Collaboration Concepts for Co-modality, CO³ is a business strategy enabling companies throughout the supply chain to set up and maintain initiatives to manage and optimise their logistics and transport operations by increasing load factors, reducing empty movements and stimulate co-modality, through Horizontal Collaboration between industry partners, thereby reducing transport externalities such as greenhouse gas emissions and costs.
The CO³ consortium is made up of logistics specialists, manufacturing industry and transport service providers. The model framework with legal and operational guidelines for collaborative projects in the supply chain, will be part of their focus.
The 18 partners of the consortium in 7 EU countries will coordinate studies and expert group exchanges over a period of three years, and build on existing methodologies to develop European legal and operational frameworks for freight flow bundling, (WP2). The project will come up with joint business models for inter- and intra-supply chain collaboration (WP3) to deliver more efficient transport processes, increase load factors and increase the use of co-modal transport.
The results of the studies and expert group exchanges will be applied and validated in the market via case studies (WP4). The aim is to set up at least four different real-life applications of collaboration across the supply chain by using road transport, multimodal transport, regional retail distribution and collaboration for warehousing activities. We will also promote and facilitate matchmaking and knowledge-sharing through CO³ conferences and practical workshops to transfer knowledge and increase the market acceptance of the CO³ results. This will be done through discussions with a High Level Board of European Industry supply chain Leaders (WP5).
Teaming up for an effective logistics sector
A new logistics model means different customers can bundle their freight flows. An EU initiative developed tools and legal frameworks to facilitate business adoption of this concept.
Conventional logistics operations create inefficiencies as freight companies have separate contracts with many shipping companies, effectively meaning wasted capacity. A more economical model, called horizontal collaboration, means that shipping companies can share available space to reach maximum load efficiency and asset-utilization for mutual benefit.
The EU-funded http://www.co3-project.eu/ (CO3) (Collaboration Concepts for Comodality) project took up the challenge of promoting the new business strategy's acceptance and making it work in practice. Overall, the aim was to contribute improvements to loading efficiency via collaboration among industry partners. The project's key innovation is overcoming previous barriers to the bundling concept by providing a clear set of rules and organisational structures.
To deal with the European transport system's underutilized capacity, CO3 focused on horizontal collaboration. More than 100 interviews with key stakeholders helped demonstrate the virtues of this innovative solution.
CO3 enabled such companies to identify potential bundling partners and to establish test projects. A methodology was devised for this identification and for the gathering of compatible shippers and overlapping freight flows. Collaboration models were also developed to link multiple shippers, one or more logistics service providers, and neutral trustees.
Project partners developed a legal framework, gain-sharing rules and also business models in the form of a self-assessment workbook to remove managerial barriers to horizontal collaboration. They conducted seven real-life test cases throughout Europe, designed to supply important information to logistics practitioners such as businesses, shippers and logistics service providers. Concepts for gain sharing were also designed and tested.
Much of the project's work has focused on dissemination, aimed at achieving a 'mental shift' in the industry. Presentations were given at 44 conferences. In addition, it organised four conferences and six workshops. A database was set up containing 400 contacts for potential collaboration.
CO3 led to a reduction in logistics costs and carbon footprint of 10-20 % and 20-30 %, respectively. Horizontal collaboration helps make the transport and logistics sector more efficient, effective and sustainable.