Internalization strategies of external costs of transport for a sustainable logistics

Transport is a priority issue for a sustainable development. The European Commission planned to implement a full and mandatory internalisation of the transport external costs within the 2020 (EU, 2011). Traditional inventory models, however, minimise logistics costs neglecting externalities. The aim of this paper is to evaluate the social and environmental benefits of the internalisation of the external costs in the inventory management problem. The sustainable order quantity model (Digiesi et al., 2012) has been adopted here in order to identify the optimal lot-size and transportation mean minimising logistic and external costs of transport. A sensitivity analysis has been performed in order to investigate the effects of different internalisation strategies on the solution of the inventory problem. In order to evaluate the effectiveness of the proposed strategies, they have been tested on a real case study.