Impact analysis of ship operation cost towards fertilizer distribution cost using system dynamic approach

The high cost of transportation caused by an inefficient ship operating costs is a problem that must be addressed in order to provide fertilizer products at a more competitive price. In order to reduce total distribution costs, this paper attempts to generate system dynamics modelling to simulate and solve this problem. A case study of fertilizer distribution in Dumai, Pangkal Pinang, and Bengkulu was conducted. Fertilizer distribution simulation is performed to obtain minimal operational costs based on developed single trip models, and ship operational costs are minimized using a system dynamics approach. The proposed model considers several variables, such as fertilizer demand at each destination, ship speed, and ship engine operations when sailing to the port. To develop dynamic relationships between variables, a simulation model is run. The fertilizer distribution model simulation results are then analyzed and compared to obtain the lowest fertilizer distribution operational costs by selecting the ship's speed and cargo capacity. According to the simulation results, the ship 3800 tons and 10 knots have the lowest cost in the cases of Dumai, Pangkal Pinang, and Bengkulu.