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Integration of order picking and vehicle routing in a B2C e-commerce context

Author

Listed:
  • Stef Moons

    (Research Group Logistics)

  • Katrien Ramaekers

    (Research Group Logistics)

  • An Caris

    (Research Group Logistics)

  • Yasemin Arda

    (University of Liège)

Abstract

E-commerce sales are increasing every year and customers who buy goods on the Internet have high service level expectations. In order to meet these expectations, a company’s logistics operations need to be performed carefully. Optimizing only internal warehouse processes will often lead to suboptimal solutions. The interrelationship between the order picking process and the delivery process should not be ignored. Therefore, in this study, an order picking problem and a vehicle routing problem with time windows and release dates are solved simultaneously using a single optimization framework. To the best of our knowledge, it is the first time that an order picking problem and a vehicle routing problem are integrated. A mixed integer linear programming formulation for this integrated order picking-vehicle routing problem (OP-VRP) is provided. The integrated OP-VRP is solved for small instances and the results are compared to these of an uncoordinated approach. Computational experiments show that integration can lead to cost savings of 14% on average. Furthermore, higher service levels can be offered by allowing customers to request their orders later and still get delivered within the same time windows.

Suggested Citation

  • Stef Moons & Katrien Ramaekers & An Caris & Yasemin Arda, 2018. "Integration of order picking and vehicle routing in a B2C e-commerce context," Flexible Services and Manufacturing Journal, Springer, vol. 30(4), pages 813-843, December.
    • Handle: RePEc:spr:flsman:v:30:y:2018:i:4:d:10.1007_s10696-017-9287-5
    DOI: 10.1007/s10696-017-9287-5
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    2. A. Mor & M. G. Speranza, 2020. "Vehicle routing problems over time: a survey," 4OR, Springer, vol. 18(2), pages 129-149, June.
    3. A. Mor & M. G. Speranza, 2022. "Vehicle routing problems over time: a survey," Annals of Operations Research, Springer, vol. 314(1), pages 255-275, July.
    4. Zhong, Shuya & Giannikas, Vaggelis & Merino, Jorge & McFarlane, Duncan & Cheng, Jun & Shao, Wei, 2022. "Evaluating the benefits of picking and packing planning integration in e-commerce warehouses," European Journal of Operational Research, Elsevier, vol. 301(1), pages 67-81.
    5. Berghman, Lotte & Kergosien, Yannick & Billaut, Jean-Charles, 2023. "A review on integrated scheduling and outbound vehicle routing problems," European Journal of Operational Research, Elsevier, vol. 311(1), pages 1-23.
    6. Chevroton, Hugo & Kergosien, Yannick & Berghman, Lotte & Billaut, Jean-Charles, 2021. "Solving an integrated scheduling and routing problem with inventory, routing and penalty costs," European Journal of Operational Research, Elsevier, vol. 294(2), pages 571-589.
    7. Maria A. M. Trindade & Paulo S. A. Sousa & Maria R. A. Moreira, 2022. "Ramping up a heuristic procedure for storage location assignment problem with precedence constraints," Flexible Services and Manufacturing Journal, Springer, vol. 34(3), pages 646-669, September.
    8. Manuel Ostermeier & Andreas Holzapfel & Heinrich Kuhn & Daniel Schubert, 2022. "Integrated zone picking and vehicle routing operations with restricted intermediate storage," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 44(3), pages 795-832, September.
    9. Jamili, Negin & van den Berg, Pieter L. & de Koster, René, 2022. "Quantifying the impact of sharing resources in a collaborative warehouse," European Journal of Operational Research, Elsevier, vol. 302(2), pages 518-529.
    10. Kuhn, Heinrich & Schubert, Daniel & Holzapfel, Andreas, 2021. "Integrated order batching and vehicle routing operations in grocery retail – A General Adaptive Large Neighborhood Search algorithm," European Journal of Operational Research, Elsevier, vol. 294(3), pages 1003-1021.

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