Resilient Hyperconnected Parcel Delivery Network Design Under Disruption Risks

Logistics networks are prone to disruptions inducing an increase in delivery costs and delays. Motivated by new opportunities introduced by the Physical Internet, this article studies the problem of designing resilient hyperconnected logistics hub networks. We propose two solution approaches based on integer programs (IPs) that aim to open logistics hubs in order to connect a set of origin-destination pairs using (i) multiple shortest paths and (ii) multiple shortest edge-disjoint paths. To address the inherent computational tractability issues of the first solution approach, we develop a matheuristic that leverages the structure of the problem and iteratively improves the solution by solving the same but restricted IP. To estimate the resilience of the designed networks, we propose graph-theoretic measures involving the maximum number of edge-disjoint paths connecting each origin-destination pair, and the number of short paths traversing each edge. We then develop a case study to design a class of hyperconnected parcel delivery networks in China and evaluate the impact of various disruption scenarios on the resulting distance traveled by parcels. Our results show a significant increase in the designed networks’ capability to sustain disruptions in comparison to traditional lean logistics meshed networks, with marginal compromise in performance in the absence of disruptions. This study validates the relevance of the proposed resilience measures in estimating network resilience and demonstrates the value of hyperconnectivity in designing efficient and resilient logistics networks.