From Horizontal Collaboration to the Physical Internet – A Case Study from Austria

The growing global flow of goods, the increasing problem of traffic congestion and the inefficiencies associated with distribution and logistics or the discerning consumers’ high standards for products and delivery services lead to new logistical requirements, for which the model of the ‘Physical Internet’ has emerged as a probable solution. Physical Internet is a novel concept that transforms how physical objects are designed, manufactured and distributed aiming for a radical sustainability improvement. The implementation of the Physical Internet leads to the need to rethink some basic concepts of logistics such as the shift from private supply networks to open supply networks. Therefore, increased collaboration and coordination is necessary. In order to make a productive contribution to the first steps towards the Physical Internet in Austria, this article focuses on the need for horizontal collaborations, which are required to realize the Physical Internet. Moreover, the study explores the views, experiences, beliefs and motivations of transport service providers in Austria in the context of horizontal collaborations and the Physical Internet. A literature research was carried out in a first step. Afterwards interviews with forwarding agencies and logistics service providers were conducted. Findings highlight that barriers such as the fear of antitrust fines or the high administrative input have to be removed to enable close vertical and horizontal collaboration among different logistics companies in Europe, as the vision of the Physical Internet is encouraging a smooth transition from independent supply chains to open global supply networks. The implementation of a Physical Internet in its full expression could probably take decades, but individual elements of it, such as horizontal and vertical cooperation, are a first step towards this vision. Important components of the implementation process are awareness raising and information sharing.