Horizontal Collaboration in Supply Chains

Martijn Graat
Martijn Graat

How can companies in Europe become more sustainable, effective, and efficient? Work together when shipping goods! 3PL’s and freight forwarders are trying to combine loads and increase the efficiency of Europe’s transportation system, but so far with limited success. Shippers are returning to road transportation instead of using a multi-modal approach. According to Sven Verstrepen of Trivizor this lack of sustainability is caused by the price for road transportation being far too low to reflect the external cost. With fuel prices forever on the rise and a future shortage of truck drivers, road prices are bound to rise as well. 

Antitrust Laws Blocking Collaboration

Another reason for the lack of efficiency in the European transport system is the fact the large companies are legally not allowed to work together even when the collaboration is focused on sustainability: European antitrust laws are blocking this. Sometime before 2014 these legal principles will be updated to enable horizontal collaboration between shippers, to make the European Logistics System more efficient and sustainable.

Horizontal Collaboration Within the Law

The CO3 Project is about creating an operational and legal framework for Horizontal Collaboration and develop appropriate business models. All research findings, tools, and models will be made freely available on the internet and through conferences for everyone to use.

CO3 collects information on freight flows from companies in Europe and uses that information to build a secure database (pricing information not included). The database is used to compare networks of freight flows to identify potential partners, creating synergies for both.

The CO3 Project is currently looking for companies that are willing to participate in test cases. The 4 case types:

  1. Road bundling between 2 or more shippers.
  2. Intermodal bundling between more than 2 shippers.
  3. Collaborative retail distribution (last mile).
  4. Value Added Logistics clusters / Freight Villages. 

A great example of horizontal collaboration: two Czech companies that are using the framework. One company was transporting light plastic materials (full trucks: high volume, low weight) and one company was transporting metal materials (full trucks: low volume, high weight). Co-loading tests have been successful  Net cost reduction -10%; carbon footprint reduction -30%. 

Find out more about the CO3 Project here

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