Using birth-and-death theory for container terminal strategic investment decisions

Abstract

The present study uses birth-and-death modelling in order to examine the improvement of container terminal operations in two stages of the container transportation process. The first stage is the loading/unloading process and the second is the stacking of containers in the container yard. The data has been provided by a central container terminal station located in the Eastern Mediterranean encapsulating information on infrastructure, arrivals of vessels and service times for a period of three years. A number of scenarios are estimated based on changes in the number available servers (s) and the rate of service level (μ). Results show that both the increase in the number of servers (berth/slots) and the improvement in the rate of the service levels to users contribute decisively to the optimisation of container terminal operations benefiting not only the terminal but its users as well. However, the ability of Markov theory to estimate with the use of probabilities the economic consequences that strategic investment decisions could have on terminal efficiency is also of significance.