Designing a fourth-party E-commerce logistics center: a benefit, cost and risk analysis using AHP and ANP models

The global trend of e-commerce and use of information technology is transforming the business structure of many industries and the air cargo industry is no exception. The requirement for information integration is unprecedented in the air cargo industry. The Hong Kong Government (via Airport Authority) has initiated efforts to establish a high-tech logistics centre, which could allow the leasing of both information infrastructure and physical facilities without requirement of ownership. Like any public infrastructure project, a vast amount of investment is required and there is a vast amount of risk involved as well. The success of such a centre depends on the commitment of three parties: the Hong Kong Government, the investors, and the users. While each party plays an important role towards the centre’s success, their interests might differ and in some cases be conflicting. In this paper, we evaluate the benefits, costs, and risks of such a logistic centre using a series of analytic hierarchy process (AHP) and analytic network process (ANP) models. It is shown that the proposed models can be used to examine the sharing of benefits, costs and risks such that a design agreeable to all parties can be determined.