The Impact of Logistics Activity on Cities

Logistics is a complex set of activities. Hesse and Rodrigue (2004) have developed a much quoted definition that includes a “wide set of activities dedicated to the transformation and circulation of goods, such as the material supply of production, the core distribution and transport function, wholesale and retail and also the provision of households with consumer goods as well as the related information flows”. For a city this broad array of activity can be seen to have three components. The first is the physical movement of goods (either as exports or imports), which involves airports, seaport, road and rail systems. This is the traditional trade function that has been a part of many cities for a considerable period of time. The second is a storage function, where imports, along with locally made goods, are held prior to distribution. Again this is a traditional urban task, which was once accommodated in multi-storey warehouses in industrial areas close by docks and rail yards. The third is the distribution function, involving continental/national, metropolitan and local scale deliveries by rail and road. The type and level of activity in these three aspects of logistics has changed in part because the volumes of goods moved in world trade, and between regions within nations, has grown. In addition on-time, regular delivery is now an essential element in most manufacturing processes as firms rely upon outsourced components and draw finished goods from global production systems (Hesse and Rodrigue 2006, Rodrigue and Hesse 2007). This has been felt in retail services as well where regular timed delivery has become the norm for many firms. Manufacturing and retail are now often connected via supply chain management arrangements. That integration has been tightened in many cases as the management of all supply chain tasks is in the hands of a single firm. An understanding logistics within cities needs to understand the spatial arrangements and change in the three elements as displayed in figure 1.