A Systematic Model of Inventory optimization at Seaports based on the System Dynamics Approach

Port operation and cargo handling process involves integrated activities in which any delay or stoppage results in a bottleneck in the port process. This in turn leads to a dramatic escalation in ship and cargo dwell times at anchorage, seaport terminals, or exit gates. Increasing cargo dwell time not only depreciates port equipment but also decreases port efficiency dramatically. The objective of this paper is to develop a modeling approach using the concept of System Dynamics (SD) to simulate variables affecting inventory optimization at Emam Khomeini seaports. To find proper actions by which seaports can optimize the inventory, dynamic of various variables such as dwell time, and the number of human resources and equipment simulated during 2006 to 2031. The overall results show that warehouse traffic is highly sensitive to cargo dwell time, while this is less for the quay inventory variable. The analysis shows that the 30% reduction of cargo dwell time in inventory fluctuations is much more than the 30% increase in the workforce. One solution could be increasing storage area which, apart from being a very expensive investment, maybe not be feasible due to space limitations. Consequently, terminal operators are trying to decrease average dwell time. In order to do so, the main factors which influence the number of days a container stays in the terminal need to be determined.