Source: Adapted from P.O Roberts, "Supply Chain Management: New Directions for Developing Economies".

Logistics Costs and Economic Development

Logistics costs can amount to 30% of delivered costs in less advanced economies. Comparatively, in advanced economies it can be as low as 9.5%. The differences are attributed to the nature of the economy as well as to the efficiency of the distribution system. Many factors can influence this efficiency:

• Interest rates.
• Level of competition.
• Market information.
• Transportation infrastructures.
• Telecommunication infrastructures.
• Legal system.
• Regulations and taxations.

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