Potential benefits of carrier collaboration in vehicle routing problem with pickup and delivery

ABSTRACT

This paper investigates the potential benefits of collaboration among less than truckload (LTL) carriers in fulfilling pickup and delivery jobs. It adopts the commonly used centralized collaborative planning scheme where a central authority pools all jobs and allocate them to the carriers with the objective of minimizing the total transportation cost. However, in this study, LTL carriers are allowed to retain some of the jobs. This extension to the centralized planning scheme is necessary to make collaboration practical. When the carriers are allowed to retain some of their jobs, the allocation of the pooled jobs by the central authority is more complex because it needs to consider the location of the retained jobs. To this end, a mathematical model and a solution method based on large neighborhood search (LNS) are proposed. The experimental results from hypothetical networks provide several important insights regarding cost savings for various collaboration scenarios.

KEYWORDS:

• Less-than-truckload carriers
• horizontal collaboration
• centralized planning
• retained jobs
• multi-depot vehicle routing with pickup and delivery
• site-dependent vehicle routing problem
• large neighborhood search

Acknowledgments

This study is based on a study supported by the Center for Connected Multimodal Mobility (C²M²) (USDOT Tier 1 University Transportation Center) Grant headquartered at Clemson University, Clemson, South Carolina, USA. Any opinions, findings, and conclusions or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the Center for Connected Multimodal Mobility (C2M2), and the U.S. Government assumes no liability for the contents or use thereof.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This work was supported by the Center for Connected Multimodal Mobility, a U.S. Department of Transportation Tier 1 University Transportation Center.