A Blockchain Model for Less Container Load Operations in China

A Blockchain Model for Less Container Load Operations in China

Albert Wee Kwan Tan (Malaysia Institute for Supply Chain Management, Shah Alam, Malaysia), YiFei Zhao (Shanghai Jiaotong University, Shanghai, China) and Thomas Halliday (ARCOS Solutions Pte Ltd, Singapore)
DOI: 10.4018/IJISSCM.2018040103

Abstract

In recent years, with the growth of international trade and development of economies, the volume of container throughput at China's ports has grown rapidly. Yet, the business process for the Less Container Load (LCL) transport industry in most ports of China still remain complicated and inefficient. In this article, the authors see numerous opportunities for process improvement by integrating the information among the various actors using the blockchain concept. In this paper, the authors propose to build a LCL Export Platform (LEP) using the blockchain concept to optimize the LCL operations for international trading, by integrating and sharing information among forwarder agencies and their clients.
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Literature Review

The LCL business can hardly be considered as a technological innovation but, at the same time, it does involve several aspects related to clustering processes. The advancement of LCL business will require involving upgrading current infrastructure, by using advanced carrier or cargo handling technologies, and automating the business processes (Xu, 2015). Therefore, in the deployment of LCL business, multiple skills and approaches are pre-requites for the success of such large-scale implementations. This will result in building a logistics cluster where the different actors will interact directly. It is common that consortiums are established for such projects or development initiatives, which later may turn into an industry cluster where organizations from associated industries and the surrounding communities are represented (Yossi, 2012).

Rapid developments in international trade in China have driven many managers to focus on the role of logistics and specifically on the use of IT to streamline its supply chain. One popular notion as suggested by the following stream of research argues that IT supports logistical integration through free flow of critical information, and thus increases operational efficiency and customer responsiveness (Xu, 2015; Navin Lee et al., 2013).

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