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A continuum approximation approach to the depot location problem in a crowd-shipping system

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  • Stokkink, Patrick
  • Geroliminis, Nikolas

Abstract

Last-mile delivery in the logistics chain contributes to congestion in urban networks due to frequent stops. Crowd-shipping is a sustainable and low-cost alternative to traditional delivery but relies heavily on the availability of occasional couriers. In this work, we propose a crowd-shipping system that uses depots to improve accessibility for potential crowd-shippers to serve a large portion of the demand for small parcels. While small-scale versions of this problem have been recently addressed, scaling to larger instances significantly complexifies the problem. A heuristic approach based on continuum approximation is designed to evaluate the quality of a potential set of depots. By combining an efficient and accurate approximation method with a large neighborhood search heuristic, we can efficiently find a good set of depots, even for large-scale networks. The proposed methodology allows for heterogeneity among crowd-shippers and allows identifying the expected number of delivered parcels in every region, which can be used to enhance lower-level assignment decisions.

Suggested Citation

  • Stokkink, Patrick & Geroliminis, Nikolas, 2023. "A continuum approximation approach to the depot location problem in a crowd-shipping system," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 176(C).
    • Handle: RePEc:eee:transe:v:176:y:2023:i:c:s1366554523001953
    DOI: 10.1016/j.tre.2023.103207
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