Benchmarking and Monitoring International Warehouse Operations in Europe

Abstract

We report on a cross‐sectional and longitudinal comparison of European distribution centers in the Netherlands. European distribution centers are responsible for the distribution of a manufacturer's (mostly Asian or American) products over customers in a large part of Europe, the Middle East, and Africa, often with strict service‐level agreements. In total, 65 physical warehouses, containing 140 European, Asian, and American European distribution center operations, in combination with different outsourcing relations (own‐account, dedicated outsourced, and public outsourced), were benchmarked in 2000 and monitored over the period 2000–2004. We conclude that both in 2000 and 2004, European warehouses are more efficient than Asian and American warehouses, and outsourced operations (particularly public warehouses) are more efficient than own‐account operations. Over the period 2000–2004, efficiency appears to have declined substantially; the most distinct differences are to be found among public outsourced warehouses and, because many European distribution center warehouse operations of European origin are run by public service providers, among European warehouses. This decline in efficiency also led to a decline in productivity, in spite of the fact that overall the available technology has improved. We conjecture potential causes for this decline.

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