Ho.Re.Ca. logistics and European medieval structured cities: A search for cost generators

Abstract This paper examines the current organisation of Hotel-Restaurant-Cafe/Catering (Ho.Re.Ca.) logistics in medieval structured cities from a microeconomic perspective. The paper aims to distinguish Ho.Re.Ca. specific cost generators and to provide different stakeholders with guidelines on improving the efficiency and sustainability of delivery operations. Therefore, a Ho.Re.Ca. specific costs function has been developed and calculates both internal (economic) as external (social and environmental) costs. The developed cost function follows a 3-steps approach: exploratory expert interviews and observations, the development of the cost function and, validation by the same business experts. The main findings are that mostly the characteristics of the goods determine the way Ho.Re.Ca. goods are delivered nowadays. However, the location of demand and supply for the goods and the specific handling conditions also have a significant influence. The following specific cost generators are distinguished: all labour-based activities rise the internal costs structures substantially. Congestion and city quality issues are identified as major external costs generators. Originating from these results, transport operators should focus on improving labour-based activities such as the service time by investing in e.g. innovative (un)loading equipment. For governments, the internalisation of congestion-related externalities by e.g. road pricing is decisive.