The World Bank’s Logistics Performance Index (LPI)

I. Definitions:
The World Bank’s LPI, is a comprehensive index created to help countries identify the
challenges and opportunities they face in trade logistics performance.

The LPI assesses the performance of countries in the six areas identified below and is
an equally weighted average of these six components:
 Customs: Efficiency of the customs clearance process.
 Infrastructure: Quality of trade and transport-related infrastructure.
 International Shipments: Ease of arranging competitively priced shipments.
 Logistics Competence: Competence and quality of logistics services.
 Tracking & Tracing: Ability to track and trace consignments.
 Timeliness: Frequency with which shipments reach consignee within the
scheduled or expected time.

II. Methodology:
LPI is based on a worldwide survey of multinational freight forwarders and the main
express carriers. The LPI survey1 was designed and is implemented by the World Bank
International Trade and Transport Departments, with the support of Finland's Turku
School of Economics (TSE). The World Bank conducts the LPI survey every two years.
The first LPI was published in November 2007. The next survey will be in 2012.
It does not rank countries using a comparative approach against ``best-in-the-class``.
Each country`s score is the total of the evaluation resulting from the survey.

Respondent Demographics: Nearly 1,000 logistics professionals from international

logistics companies in 130 countries participated in the 2009 LPI survey. 69 of them
participated in the 2009 LPI survey for Canada. Out of the total participants worldwide,
 By size: multinational freight forwarders-34%, global express carriers-11%, small
and medium-size freight forwarders -55%.
 By knowledge: senior executives-35%, area/country managers-25%,
department managers-24%.
 By organization level: country branch offices-39%, corporate/regional
headquarters-36%, local branch offices-11% and independent firms-14%.
 By freight mode: almost 50% of the survey participants deal with multimodal
transport operations. Individual modes of transport are also well represented,
such as the maritime (19%) and air transportation services (17%).

Constructing the LPI: The LPI survey consists of two major parts offering two different
prospective: international and domestic.
 The international LPI provides qualitative evaluations of a country, in the six
areas described above, by its trading partners-logistics professionals working
outside of the country.
 The domestic LPI provides both qualitative and quantitative assessments on the
country by logistics professionals working inside that country, including more

1
http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTTRANSPORT/EXTTLF/0,,contentMDK:2
1514122~menuPK:3875957~pagePK:210058~piPK:210062~theSitePK:515434,00.html
 detailed information on the logistics environment, core logistics processes,
institutions and performance time and cost data.

III. LPI 2010 Results for Canada:

Overall Rankings and Scores:

2010 2007 Change
Overall Rankings 14 10 -4
Overall Scores1 3.87 3.92 -0.05
Source: LPI 2010 Report and Transport Canada Analysis
1: the lower the worst.

Change in Sub-Rankings:
Six Components 2010 2007 Change
International Shipments 32 8 -24
Tracking & Tracing 15 11 -4
Customs 13 9 -4
Infrastructure 11 12 +1
Logistics Competence 8 12 +4
Timeliness 5 13 +8
Source: LPI 2010 Report and Transport Canada Analysis

Change in Scores: (a scale of 1-5)

Six Components 2010 2007 Change
International shipments 3.24 3.78 -0.54
Tracking & Tracing 4.01 3.98 +0.03
Customs 3.71 3.82 -0.11
Infrastructure 4.03 3.95 +0.08
Logistics Competence 3.99 3.85 +0.14
Timeliness 4.41 4.19 +0.22
Source: LPI 2010 Report and Transport Canada Analysis

IV. Relevance to Transport Canada:

 Monitor Canada’s logistics performance and over time.
 Rank Canada among many countries
 Identify potential areas for improvements.
 Rank Canada against other countries.
 Part of Asia Pacific Economic Cooperation (APEC) supply chain initiative.

V. Relevance to CIFFA

 Support international freight forwarding organizations within Canada

 Provide competitive benchmarking data to CIFFA Members
 Identify opportunities / improvements in foreign markets
 Supports CIFFA as ‘The Voice of Freight Forwarding’