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Order consolidation for the last-mile split delivery in online retailing

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  • Zhang, Yuankai
  • Sun, Lijun
  • Hu, Xiangpei
  • Zhao, Chen

Abstract

This paper addresses the last-mile split delivery problem emerging in online retailing, in which multiple shipments are delivered to the same customer multiple times. We propose an innovative order consolidation approach which consolidates same customers’ shipments in the delivery station and delivers them in fewer trips. An integer programming model is formulated to make a cost tradeoff between splitting and consolidating shipments, which is solved by a new three-phase heuristic algorithm. Numerical experiments are conducted to demonstrate the superiority of the order consolidation approach over the First-In-First-Out approach on various parameters and generate managerial insights for applying it in practice.

Suggested Citation

  • Zhang, Yuankai & Sun, Lijun & Hu, Xiangpei & Zhao, Chen, 2019. "Order consolidation for the last-mile split delivery in online retailing," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 122(C), pages 309-327.
    • Handle: RePEc:eee:transe:v:122:y:2019:i:c:p:309-327
    DOI: 10.1016/j.tre.2018.12.011
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    Cited by:

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    2. Liu, Bingbing & Guo, Xiaolong & Yu, Yugang & Zhou, Qiang, 2019. "Minimizing the total completion time of an urban delivery problem with uncertain assembly time," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 132(C), pages 163-182.
    3. Zhang, Yuankai & Lin, Wei-Hua & Huang, Minfang & Hu, Xiangpei, 2021. "Multi-warehouse package consolidation for split orders in online retailing," European Journal of Operational Research, Elsevier, vol. 289(3), pages 1040-1055.
    4. Xu, Xiaoping & Zhang, Mengying & Chen, Lai & Yu, Yugang, 2022. "The region-cap allocation and delivery time decision in the marketplace mode under the cap-and-trade regulation," International Journal of Production Economics, Elsevier, vol. 247(C).
    5. John Olsson & Daniel Hellström & Henrik Pålsson, 2019. "Framework of Last Mile Logistics Research: A Systematic Review of the Literature," Sustainability, MDPI, vol. 11(24), pages 1-25, December.
    6. Yi Jiang & Polin Lai & Chia-Hsun Chang & Kum Fai Yuen & Sihang Li & Xinchen Wang, 2021. "Sustainable Management for Fresh Food E-Commerce Logistics Services," Sustainability, MDPI, vol. 13(6), pages 1-19, March.
    7. Rohit Kumar Singh & Sachin Modgil & Padmanav Acharya, 2019. "Assessment of Supply Chain Flexibility Using System Dynamics Modeling," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 20(1), pages 39-63, December.
    8. Romero-Silva, Rodrigo & Mujica Mota, Miguel, 2022. "Trade-offs in the landside operations of air cargo hubs: Horizontal cooperation and shipment consolidation policies considering capacitated nodes," Journal of Air Transport Management, Elsevier, vol. 103(C).
    9. Valentina Romagnoli & Joachim Felix Aigner & Thomas Berlinghof & Niki Bey & Jan-Markus Rodger & Cordelia Patz, 2020. "Identification and assessment of opportunities and threats for the Circular Economy arising from E-commerce," JRC Research Reports JRC122233, Joint Research Centre.
    10. Jiu, Song & Wang, Dan & Ma, Zujun, 2024. "Benders decomposition for robust distribution network design and operations in online retailing," European Journal of Operational Research, Elsevier, vol. 315(3), pages 1069-1082.
    11. Marta Viu-Roig & Eduard J. Alvarez-Palau, 2020. "The Impact of E-Commerce-Related Last-Mile Logistics on Cities: A Systematic Literature Review," Sustainability, MDPI, vol. 12(16), pages 1-19, August.
    12. Ji, Ying & Du, Jianhui & Han, Xiaoya & Wu, Xiaoqing & Huang, Ripeng & Wang, Shilei & Liu, Zhimin, 2020. "A mixed integer robust programming model for two-echelon inventory routing problem of perishable products," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 548(C).
    13. Wei, Bo & Çetinkaya, Sıla & Cline, Daren B.H., 2023. "Inbound replenishment and outbound dispatch decisions under hybrid shipment consolidation policies: An analytical model and comparison," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 175(C).
    14. Wang, Yuan & Lei, Linfei & Zhang, Dongxiang & Lee, Loo Hay, 2020. "Towards delivery-as-a-service: Effective neighborhood search strategies for integrated delivery optimization of E-commerce and static O2O parcels," Transportation Research Part B: Methodological, Elsevier, vol. 139(C), pages 38-63.
    15. Luce Brotcorne & Guido Perboli & Mariangela Rosano & Qu Wei, 2019. "A Managerial Analysis of Urban Parcel Delivery: A Lean Business Approach," Sustainability, MDPI, vol. 11(12), pages 1-23, June.
    16. Chu, Xiang & Liu, Jun & Ren, Long & Gong, Daqing, 2020. "Optimal contract design with a common agency in last-mile logistics," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 139(C).

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