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Enabling Urban Logistics Services at La Poste through Multi-Echelon Location-Routing

Author

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  • Matthias Winkenbach

    (Massachusetts Institute of Technology, Cambridge, Massachusetts 02139)

  • Paul R. Kleindorfer

    (INSEAD, 77305 Fontainebleau, France)

  • Stefan Spinler

    (WHU — Otto Beisheim School of Management, 56179 Vallendar, Germany)

Abstract

We present a large-scale static and deterministic mixed-integer linear programming (MILP) model solving a two-echelon capacitated location-routing problem (2E-CLRP) with modal choice in the context of urban logistics services (ULS). This model aims to support the development of profitable ULS by guiding the strategic decision making of postal operators as they design an optimal facility network and vehicle fleet for the centralized consolidation and transportation of inbound and outbound urban freight flows. After comprehensively analyzing operating data from La Poste , we identify the key determinants of an optimal infrastructure and fleet design for the centralized coordination and consolidation of urban freight flows under a global service time constraint. Further, we discuss the optimal design’s sensitivity to changes in the input data and parameters of the 2E-CLRP model. The main theoretical contributions of this work are an optimal routing cost estimation formula and an optimization heuristic. Together these allow us to solve the large-scale MILP problem presented here within a reasonable time and with little loss of precision.

Suggested Citation

  • Matthias Winkenbach & Paul R. Kleindorfer & Stefan Spinler, 2016. "Enabling Urban Logistics Services at La Poste through Multi-Echelon Location-Routing," Transportation Science, INFORMS, vol. 50(2), pages 520-540, May.
    • Handle: RePEc:inm:ortrsc:v:50:y:2016:i:2:p:520-540
    DOI: 10.1287/trsc.2015.0624
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    Cited by:

    1. Matthias Winkenbach & Alain Roset & Stefan Spinler, 2016. "Strategic Redesign of Urban Mail and Parcel Networks at La Poste," Interfaces, INFORMS, vol. 46(5), pages 445-458, October.
    2. Janjevic, Milena & Winkenbach, Matthias & Merchán, Daniel, 2019. "Integrating collection-and-delivery points in the strategic design of urban last-mile e-commerce distribution networks," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 131(C), pages 37-67.
    3. Faugère, Louis & Klibi, Walid & White, Chelsea & Montreuil, Benoit, 2022. "Dynamic pooled capacity deployment for urban parcel logistics," European Journal of Operational Research, Elsevier, vol. 303(2), pages 650-667.
    4. Snoeck, André & Winkenbach, Matthias, 2020. "The value of physical distribution flexibility in serving dense and uncertain urban markets," Transportation Research Part A: Policy and Practice, Elsevier, vol. 136(C), pages 151-177.
    5. Ouyang, Zhiyuan & Leung, Eric Ka Ho & Huang, George Q., 2022. "Community logistics for dynamic vehicle dispatching: The effects of community departure “time” and “space”," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 165(C).
    6. Janjevic, Milena & Winkenbach, Matthias, 2020. "Characterizing urban last-mile distribution strategies in mature and emerging e-commerce markets," Transportation Research Part A: Policy and Practice, Elsevier, vol. 133(C), pages 164-196.
    7. Yu, Vincent F. & Jodiawan, Panca & Hou, Ming-Lu & Gunawan, Aldy, 2021. "Design of a two-echelon freight distribution system in last-mile logistics considering covering locations and occasional drivers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 154(C).
    8. Zhang, Lele & Ding, Pengyuan & Thompson, Russell G., 2023. "A stochastic formulation of the two-echelon vehicle routing and loading bay reservation problem," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 177(C).
    9. Bergmann, Felix M. & Wagner, Stephan M. & Winkenbach, Matthias, 2020. "Integrating first-mile pickup and last-mile delivery on shared vehicle routes for efficient urban e-commerce distribution," Transportation Research Part B: Methodological, Elsevier, vol. 131(C), pages 26-62.
    10. Janjevic, Milena & Merchán, Daniel & Winkenbach, Matthias, 2021. "Designing multi-tier, multi-service-level, and multi-modal last-mile distribution networks for omni-channel operations," European Journal of Operational Research, Elsevier, vol. 294(3), pages 1059-1077.
    11. Fontaine, Pirmin & Minner, Stefan & Schiffer, Maximilian, 2023. "Smart and sustainable city logistics: Design, consolidation, and regulation," European Journal of Operational Research, Elsevier, vol. 307(3), pages 1071-1084.
    12. Nils Boysen & Stefan Fedtke & Stefan Schwerdfeger, 2021. "Last-mile delivery concepts: a survey from an operational research perspective," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 43(1), pages 1-58, March.
    13. Laranjeiro, Patrícia F. & Merchán, Daniel & Godoy, Leonardo A. & Giannotti, Mariana & Yoshizaki, Hugo T.Y. & Winkenbach, Matthias & Cunha, Claudio B., 2019. "Using GPS data to explore speed patterns and temporal fluctuations in urban logistics: The case of São Paulo, Brazil," Journal of Transport Geography, Elsevier, vol. 76(C), pages 114-129.
    14. Pahwa, Anmol & Jaller, Miguel, 2022. "A cost-based comparative analysis of different last-mile strategies for e-commerce delivery," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
    15. Ouyang, Zhiyuan & Leung, Eric K.H. & Huang, George Q., 2023. "Community logistics and dynamic community partitioning: A new approach for solving e-commerce last mile delivery," European Journal of Operational Research, Elsevier, vol. 307(1), pages 140-156.
    16. Schaumann, Sarah K. & Bergmann, Felix M. & Wagner, Stephan M. & Winkenbach, Matthias, 2023. "Route efficiency implications of time windows and vehicle capacities in first- and last-mile logistics," European Journal of Operational Research, Elsevier, vol. 311(1), pages 88-111.
    17. Merchán, Daniel & Winkenbach, Matthias & Snoeck, André, 2020. "Quantifying the impact of urban road networks on the efficiency of local trips," Transportation Research Part A: Policy and Practice, Elsevier, vol. 135(C), pages 38-62.
    18. Snoeck, André & Winkenbach, Matthias & Fransoo, Jan C., 2023. "On-demand last-mile distribution network design with omnichannel inventory," Other publications TiSEM 83b06c9f-2a65-4aaf-880b-2, Tilburg University, School of Economics and Management.
    19. Ben Mohamed, Imen & Klibi, Walid & Sadykov, Ruslan & Şen, Halil & Vanderbeck, François, 2023. "The two-echelon stochastic multi-period capacitated location-routing problem," European Journal of Operational Research, Elsevier, vol. 306(2), pages 645-667.
    20. Louis Faugère & Chelsea White & Benoit Montreuil, 2020. "Mobile Access Hub Deployment for Urban Parcel Logistics," Sustainability, MDPI, vol. 12(17), pages 1-22, September.
    21. Aurelija Burinskienė, 2021. "Designing a Multi-Stage Transport System Serving e-Commerce Activity," Sustainability, MDPI, vol. 13(11), pages 1-19, May.

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