New Zealand (NZ) construction typifies fragmentation, categorising 98% of the approximately 67000 operating businesses as small or sole trading operators. Fragmentation builds inefficiencies at the boundaries of the component segments of the extensive and trans-disciplinary construction supply chain (CSC). Project-centric delivery accentuates these. Conversely, significant opportunity exists for consolidation and improved efficiency through de-fragmentation.

Vertically integrating (VI) the CSC and managing it from the supplier-end vis-à-vis the project-end are effective defragmenters. Leaving the ownership of component elements independent, their management is integrated above the tactical supply chain level, resulting in improved operational efficiencies. Quantification of impacts is, however, challenged by lack of tangibility, which can be overcome by focussing on the quantifiable parameters of individual CSC components.

This study examines the transport component of a narrow NZ CSC segment where VI has been effectively implemented. It investigates transport operations in the context of plasterboard, where distribution has been integrated with manufacturing and outsourced on a second-party logistics (2PL) model. It examines a three-month operational transport dataset to quantify improved performance compared to the conventional echeloned CSC, simulates the use of operations research for resource optimisation, discusses sustainability outcomes, and recommends business process re-engineering and warehousing under modified circumstances.