Assessing Total Logistics Costs: Case Study During the Execution of Cement Projects in Indonesia

Assessing Total Logistics Costs: Case Study During the Execution of Cement Projects in Indonesia

Effnu Subiyanto (Widya Mandala Surabaya Catholic University, Indonesia)
Copyright: © 2020 |Pages: 17
DOI: 10.4018/IJAL.2020070103
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Logistics infrastructure is widely known as the most significant economics hurdle in Indonesia over recent decades due to the limited logistics infrastructure. This study aims to examine total logistics costs during the execution of several cement projects in Indonesia within the period 2010-2018. The panel data method of eight cement projects in Indonesia has been developed, analysed, and measured. Due to the limited logistics infrastructures, the logistics cost rose to 27.129% of the Gross National Product (GNP) in Indonesia. Further, this paper provides suggestions for Indonesia's government to develop logistics infrastructure.
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2. Literature Review

Logistics, defined by Council of Logistics Management (CLM) in 1986 based on the study of Stock and Lambert (2001), is the process of planning, implementing and controlling the flow of raw materials or services that are efficient, effective since the goods in inventory to finished goods, from the point of loading to the point of consumption in order to meet customer demand. Clark, Dollar, and Micco (2004) developed the definition of logistics and stated that logistics is the transparency and professionalism of customs and control environment as stipulated in the standard system harmonization according to international regulations. For ports, the main protocol to implement logistics systems, according to Clark et al. (2004) are (1) efficiency of the port; (2) the procedures; (3) regulation; and (4) e-Business.

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