Regional distribution networks: evaluation of the functioning and development efficiency

Abstract

The efficiency of the regional distribution network (DN) has the greatest impact on the timing, cost of goods delivery and quality of customer service. On the basis of the analysis the main social, economic and environmental indicators characterizing the activities of distribution networks were identified. The authors evaluate the effectiveness of distribution networks of the regions of Kazakhstan on the basis of the selected indicators and develop recommendations for their improvement. Research methods include correlation and regression analysis; factor analysis of data with reduction and allocation of the most important factors and the method of data analysis (DEA-analysis) to assess performance. Statistical data from 17 regions of Kazakhstan for 2000-2020 were used for the analysis. The results regarding regional distribution network effectiveness show the uneven development of distribution systems in the regions of Kazakhstan - from high- to low-efficient, which is the reason for the growth of the return effect in the most prosperous regions and reduction of the return effect in the regions with inefficient distribution networks. The most important factors affecting the efficiency of DN are investments in infrastructure, goods turnover and cargo turnover, the value of inventory and retail space, the number of Internet and mobile app users, the length of roads, employment, the share of recycling and waste disposal. It is concluded that the reason for such a high differentiation of the regional DN is associated with weak government support for the trade infrastructure environment, uneven efficiency of the distribution network in the regions and their unequal development. The regions have been ranked according to the level of efficiency of DN functioning. The results allow us to conduct differentiated policy on measures to support and stimulate the development and management of distribution networks in the regions, based on their level of efficiency. The practical implementation of the recommendations will reduce the gap in the level of development of regional DN.