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Bidding Strategies for Carrier in Combinatorial Transportation Auction

Author

Listed:
  • Pittawat Ueasangkomsate

    (Chulalongkorn University, Japan)

  • Manoj Lohatepanont

    (Chulalongkorn University, Thailand)

Abstract

In combinatorial auction for truckload transportation service procurement, we introduce the bidding strategy for carrier facing the hard valuation problem to all possible routes. The model uses a bid-to-cost ratio of carriers surveyed in Thailand to represent the bidding behavior in combinatorial freight procurement. This model facilitates carrier to value the bid price for interested packages that involve with pattern of transportation service under different competitive environment. The results of analysis with hypotheses in regression model reveal that pattern of transportation service, number of competitors, pattern of transportation service with number of competitors and a pre-empty backhaul to new lane distance ratio do impact significantly on bid price of carrier in combinatorial transportation auction. To find optimal bid price for interested packages in the incomplete information game, the empirical study in stochastic optimization problem with Monte Carlo method can present the best solution for bidder in order to acquire the maximum expected profit in the auction. The results obtained from optimal solution also show that they are more than the average benefit in the competition market considerably.

Suggested Citation

  • Pittawat Ueasangkomsate & Manoj Lohatepanont, 2012. "Bidding Strategies for Carrier in Combinatorial Transportation Auction," International Journal of Business Research and Management (IJBRM), Computer Science Journals (CSC Journals), vol. 3(1), pages 1-17, February.
    • Handle: RePEc:aml:intbrm:v:3:y:2012:i:1:p:1-17
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    References listed on IDEAS

    as
    1. Lee, Chi-Guhn & Kwon, Roy H. & Ma, Zhong, 2007. "A carrier's optimal bid generation problem in combinatorial auctions for transportation procurement," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 43(2), pages 173-191, March.
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    4. Regan, A C & Song, Jiongjiong, 2003. "Combinatorial Auctions for Transportation Service Procurement: The Carrier Perspective," University of California Transportation Center, Working Papers qt7sq003mj, University of California Transportation Center.
    5. S.J. Rassenti & V.L. Smith & R.L. Bulfin, 1982. "A Combinatorial Auction Mechanism for Airport Time Slot Allocation," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 402-417, Autumn.
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    Cited by:

    1. Triki, Chefi & Oprea, Simona & Beraldi, Patriza & Crainic, Teodor Gabriel, 2014. "The stochastic bid generation problem in combinatorial transportation auctions," European Journal of Operational Research, Elsevier, vol. 236(3), pages 991-999.

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    More about this item

    Keywords

    A Bid-to-Cost Ratio; Bid Price; Combinatorial Auction; Transportation Procurement; Bidding Strategies; Optimization Problem;
    All these keywords.

    JEL classification:

    • M0 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General

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