IDEAS home Printed from https://ideas.repec.org/a/gam/jlogis/v9y2025i3p96-d1703969.html

Cost Modeling for Pickup and Delivery Outsourcing in CEP Operations: A Multidimensional Approach

Author

Listed:
  • Ermin Muharemović

    (Faculty of Traffic and Communications, University of Sarajevo, 71000 Sarajevo, Bosnia and Herzegovina)

  • Amel Kosovac

    (Faculty of Traffic and Communications, University of Sarajevo, 71000 Sarajevo, Bosnia and Herzegovina)

  • Muhamed Begović

    (Faculty of Traffic and Communications, University of Sarajevo, 71000 Sarajevo, Bosnia and Herzegovina)

  • Snežana Tadić

    (Faculty of Transport and Traffic Engineering, University of Belgrade, 11000 Beograd, Serbia)

  • Mladen Krstić

    (Faculty of Transport and Traffic Engineering, University of Belgrade, 11000 Beograd, Serbia)

Abstract

Background : The growth of parcel volumes in urban areas, largely driven by e-commerce, has increased the complexity of pickup and delivery operations. To meet demands for cost efficiency, flexibility, and sustainability, CEP (Courier, Express, and Parcel) operators increasingly outsource segments of their last-mile networks. Methods : This study proposes a novel multidimensional cost model for outsourcing, integrating five key variables: transport unit type (parcel/pallet), service phase (pickup/delivery), vehicle category, powertrain type, and delivery point type. The model applies correction coefficients based on internal operational costs, further adjusted for location and service quality using a bonus/malus mechanism. Results : Each cost component is calculated independently, enabling full transparency and route-level cost tracking. A real-world case study was conducted using operational data from a CEP operator in Bosnia and Herzegovina. The model demonstrated improved accuracy and fairness in cost allocation, with measurable savings of up to 7% compared to existing fixed-price models. Conclusions : The proposed model supports data-driven outsourcing decisions, allows tailored cost structuring based on operational realities, and aligns with sustainable last-mile delivery strategies. It offers a scalable and adaptable tool for CEP operators seeking to enhance cost control and service efficiency in complex urban environments.

Suggested Citation

  • Ermin Muharemović & Amel Kosovac & Muhamed Begović & Snežana Tadić & Mladen Krstić, 2025. "Cost Modeling for Pickup and Delivery Outsourcing in CEP Operations: A Multidimensional Approach," Logistics, MDPI, vol. 9(3), pages 1-26, July.
    • Handle: RePEc:gam:jlogis:v:9:y:2025:i:3:p:96-:d:1703969
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2305-6290/9/3/96/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2305-6290/9/3/96/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Ilan Oshri & Julia Kotlarsky & Leslie P. Willcocks, 2023. "The Handbook of Global Outsourcing and Offshoring," Springer Books, Springer, edition 4, number 978-3-031-12034-3, January.
    2. Alena Otto & Nils Boysen & Armin Scholl & Rico Walter, 2017. "Ergonomic workplace design in the fast pick area," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 39(4), pages 945-975, October.
    3. Alnaggar, Aliaa & Gzara, Fatma & Bookbinder, James H., 2024. "Compensation guarantees in crowdsourced delivery: Impact on platform and driver welfare," Omega, Elsevier, vol. 122(C).
    4. Seung Yoon Ko & Sung Won Cho & Chulung Lee, 2018. "Pricing and Collaboration in Last Mile Delivery Services," Sustainability, MDPI, vol. 10(12), pages 1-20, December.
    5. Techane Bosona, 2020. "Urban Freight Last Mile Logistics—Challenges and Opportunities to Improve Sustainability: A Literature Review," Sustainability, MDPI, vol. 12(21), pages 1-20, October.
    6. Jagannath Roy & Dragan Pamučar & Samarjit Kar, 2020. "Evaluation and selection of third party logistics provider under sustainability perspectives: an interval valued fuzzy-rough approach," Annals of Operations Research, Springer, vol. 293(2), pages 669-714, October.
    7. Su, E. & Qin, Hu & Li, Jiliu & Pan, Kai, 2023. "An exact algorithm for the pickup and delivery problem with crowdsourced bids and transshipment," Transportation Research Part B: Methodological, Elsevier, vol. 177(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Patrick Klein & Bastian Popp, 2022. "Last-Mile Delivery Methods in E-Commerce: Does Perceived Sustainability Matter for Consumer Acceptance and Usage?," Sustainability, MDPI, vol. 14(24), pages 1-27, December.
    2. Alnaggar, Aliaa & Bhatt, Sahil, 2026. "Fleet size planning in crowdsourced delivery: Balancing service level and driver utilization," Omega, Elsevier, vol. 139(C).
    3. Filip Škultéty & Dominika Beňová & Jozef Gnap, 2021. "City Logistics as an Imperative Smart City Mechanism: Scrutiny of Clustered EU27 Capitals," Sustainability, MDPI, vol. 13(7), pages 1-16, March.
    4. Danish Nasir & Rakesh Venkitasubramony & Suresh Kumar Jakhar, 2023. "Energy-based storage assignment in a multi-aisle warehouse," OPSEARCH, Springer;Operational Research Society of India, vol. 60(4), pages 1951-1975, December.
    5. Lin, Boyu & Liu, Qiumin & Jiang, Rui & Li, Xingang & Cui, Di, 2025. "Departure time choices and comparisons of household commuting based on the stochastic bottleneck model," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 674(C).
    6. Mladen Krstić & Giulio Paolo Agnusdei & Snežana Tadić & Pier Paolo Miglietta, 2023. "Prioritization of e-traceability drivers in the agri-food supply chains," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 11(1), pages 1-26, December.
    7. David Winkelmann & Frederik Tolkmitt & Matthias Ulrich & Michael Römer, 2025. "Integrated storage assignment for an E-grocery fulfilment centre: accounting for day-of-week demand patterns," Flexible Services and Manufacturing Journal, Springer, vol. 37(2), pages 558-598, June.
    8. Danish Nasir & Rakesh Venkitasubramony & Suresh Kumar Jakhar, 2025. "Ergonomics in warehouse design and operations: a systematic literature review," Operational Research, Springer, vol. 25(1), pages 1-28, March.
    9. Jiarong Chen & Jungwook Lee & Hyangsook Lee, 2025. "A Study on the Site Selection of Urban Logistics Centers Utilizing Public Infrastructure," Sustainability, MDPI, vol. 17(15), pages 1-20, July.
    10. Ausseil, Rosemonde & Ulmer, Marlin W. & Pazour, Jennifer A., 2024. "Online acceptance probability approximation in peer-to-peer transportation," Omega, Elsevier, vol. 123(C).
    11. Diefenbach, Heiko & Emde, Simon & Glock, Christoph H., 2020. "Loading tow trains ergonomically for just-in-time part supply," European Journal of Operational Research, Elsevier, vol. 284(1), pages 325-344.
    12. Vitalii Naumov & Olha Shulika & Oleksandra Orda & Hanna Vasiutina & Marek Bauer & Myroslav Oliskevych, 2022. "Shaping the Optimal Technology for Servicing the Long-Distance Deliveries of Packaged Cargo by Road Transport," Sustainability, MDPI, vol. 14(12), pages 1-17, June.
    13. Andrea Temporelli & Paola Cristina Brambilla & Elisabetta Brivio & Pierpaolo Girardi, 2022. "Last Mile Logistics Life Cycle Assessment: A Comparative Analysis from Diesel Van to E-Cargo Bike," Energies, MDPI, vol. 15(20), pages 1-18, October.
    14. Oleksandra Osypchuk & Katarzyna Sosik, 2021. "Impact of the Construction Supplies Implementation on Road Safety in the City Center: A Case Study of the City of Szczecin," Sustainability, MDPI, vol. 13(4), pages 1-15, February.
    15. Łukasz Sułkowski & Katarzyna Kolasińska-Morawska & Marta Brzozowska & Paweł Morawski & Tomasz Schroeder, 2022. "Last Mile Logistics Innovations in the Courier-Express-Parcel Sector Due to the COVID-19 Pandemic," Sustainability, MDPI, vol. 14(13), pages 1-25, July.
    16. Mayr, Kathrin & Heininger, Richard & Teller, Christoph & Stary, Christian, 2025. "Beware of the customer: Managing customer deviance in last mile logistics," International Journal of Production Economics, Elsevier, vol. 289(C).
    17. Ananna Paul & Nagesh Shukla & Sanjoy Kumar Paul & Andrea Trianni, 2021. "Sustainable Supply Chain Management and Multi-Criteria Decision-Making Methods: A Systematic Review," Sustainability, MDPI, vol. 13(13), pages 1-28, June.
    18. Montero-Vega, Mariana & Estrada, Miquel & Thigulla, Divya Teja, 2025. "Understanding the impact of socio-demographic differences on acceptance of last-mile delivery technologies: A comparative analysis," Journal of Transport Geography, Elsevier, vol. 126(C).
    19. David Winkelmann & Frederik Tolkmitt & Matthias Ulrich & Michael Romer, 2022. "Integrated storage assignment for an e-grocery fulfilment centre: Accounting for day-of-week demand patterns," Papers 2209.03998, arXiv.org, revised May 2023.
    20. Boysen, Nils & Briskorn, Dirk & Fedtke, Stefan & Schmickerath, Marcel, 2019. "Automated sortation conveyors: A survey from an operational research perspective," European Journal of Operational Research, Elsevier, vol. 276(3), pages 796-815.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jlogis:v:9:y:2025:i:3:p:96-:d:1703969. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager The email address of this maintainer does not seem to be valid anymore. Please ask MDPI Indexing Manager to update the entry or send us the correct address (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.