IDEAS home Printed from https://ideas.repec.org/a/pal/jorsoc/v59y2008i11d10.1057_palgrave.jors.2602489.html
   My bibliography  Save this article

Horizontal cooperation among freight carriers: request allocation and profit sharing

Author

Listed:
  • M A Krajewska

    (University of Bremen)

  • H Kopfer

    (University of Bremen)

  • G Laporte

    (HEC Montréal)

  • S Ropke

    (HEC Montréal)

  • G Zaccour

    (GERAD, HEC Montréal)

Abstract

In modern transportation systems, the potential for further decreasing the costs of fulfilling customer requests is severely limited while market competition is constantly reducing revenues. However, increased competitiveness through cost reductions can be achieved if freight carriers cooperate in order to balance their request portfolios. Participation in such coalitions can benefit the entire coalition, as well as each participant individually, thus reinforcing the market position of the partners. The work presented in this paper uniquely combines features of routing and scheduling problems and of cooperative game theory. In the first part, the profit margins resulting from horizontal cooperation among freight carriers are analysed. It is assumed that the structure of customer requests corresponds to that of a pickup and delivery problem with time windows for each freight carrier. In the second part, the possibilities of sharing these profit margins fairly among the partners are discussed. The Shapley value can be used to determine a fair allocation. Numerical results for real-life and artificial instances are presented.

Suggested Citation

  • M A Krajewska & H Kopfer & G Laporte & S Ropke & G Zaccour, 2008. "Horizontal cooperation among freight carriers: request allocation and profit sharing," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 59(11), pages 1483-1491, November.
    • Handle: RePEc:pal:jorsoc:v:59:y:2008:i:11:d:10.1057_palgrave.jors.2602489
    DOI: 10.1057/palgrave.jors.2602489
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/palgrave.jors.2602489
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/palgrave.jors.2602489?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gérard P. Cachon & Martin A. Lariviere, 1999. "Capacity Allocation Using Past Sales: When to Turn-and-Earn," Management Science, INFORMS, vol. 45(5), pages 685-703, May.
    2. Yue, Jinfeng & Austin, Jill & Wang, Min-Chiang & Huang, Zhimin, 2006. "Coordination of cooperative advertising in a two-level supply chain when manufacturer offers discount," European Journal of Operational Research, Elsevier, vol. 168(1), pages 65-85, January.
    3. Fernandez, Francisco R. & Hinojosa, Miguel A. & Puerto, Justo, 2004. "Multi-criteria minimum cost spanning tree games," European Journal of Operational Research, Elsevier, vol. 158(2), pages 399-408, October.
    4. Cruijssen, F. & Salomon, M., 2004. "Empirical Study : Order Sharing Between Transportation Companies may Result in Cost Reductions Between 5 to 15 Percent," Discussion Paper 2004-80, Tilburg University, Center for Economic Research.
    5. Stefan Ropke & David Pisinger, 2006. "An Adaptive Large Neighborhood Search Heuristic for the Pickup and Delivery Problem with Time Windows," Transportation Science, INFORMS, vol. 40(4), pages 455-472, November.
    6. A. van den Nouweland & P. Borm & W. van Golstein Brouwers & R. Groot Bruinderink & S. Tijs, 1996. "A Game Theoretic Approach to Problems in Telecommunication," Management Science, INFORMS, vol. 42(2), pages 294-303, February.
    7. Ordeshook,Peter C., 1986. "Game Theory and Political Theory," Cambridge Books, Cambridge University Press, number 9780521315937, September.
    8. Manuel P. Baganha & Morris A. Cohen, 1998. "The Stabilizing Effect of Inventory in Supply Chains," Operations Research, INFORMS, vol. 46(3-supplem), pages 72-83, June.
    9. Jorgensen, Steffen & Taboubi, Sihem & Zaccour, Georges, 2003. "Retail promotions with negative brand image effects: Is cooperation possible?," European Journal of Operational Research, Elsevier, vol. 150(2), pages 395-405, October.
    10. Adler, Nicole, 2001. "Competition in a deregulated air transportation market," European Journal of Operational Research, Elsevier, vol. 129(2), pages 337-345, March.
    11. Serdar Sayman & Stephen J. Hoch & Jagmohan S. Raju, 2002. "Positioning of Store Brands," Marketing Science, INFORMS, vol. 21(4), pages 378-397, June.
    12. Sven de Vries & Rakesh V. Vohra, 2003. "Combinatorial Auctions: A Survey," INFORMS Journal on Computing, INFORMS, vol. 15(3), pages 284-309, August.
    13. Cruijssen, F. & Salomon, M., 2004. "Empirical Study : Order Sharing Between Transportation Companies may Result in Cost Reductions Between 5 to 15 Percent," Other publications TiSEM 308c6567-826b-4471-9105-9, Tilburg University, School of Economics and Management.
    14. Slikker, Marco & Fransoo, Jan & Wouters, Marc, 2005. "Cooperation between multiple news-vendors with transshipments," European Journal of Operational Research, Elsevier, vol. 167(2), pages 370-380, December.
    15. Martin J. Osborne & Ariel Rubinstein, 1994. "A Course in Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650401, April.
    16. Matsubayashi, Nobuo & Umezawa, Masashi & Masuda, Yasushi & Nishino, Hisakazu, 2005. "A cost allocation problem arising in hub-spoke network systems," European Journal of Operational Research, Elsevier, vol. 160(3), pages 821-838, February.
    17. Slats, Piet A. & Bhola, Bis & Evers, Joseph J. M. & Dijkhuizen, Gert, 1995. "Logistic chain modelling," European Journal of Operational Research, Elsevier, vol. 87(1), pages 1-20, November.
    18. Li, Susan X. & Huang, Zhimin & Zhu, Joe & Chau, Patrick Y. K., 2002. "Cooperative advertising, game theory and manufacturer-retailer supply chains," Omega, Elsevier, vol. 30(5), pages 347-357, October.
    19. Carter, Craig R. & Jennings, Marianne M., 2002. "Social responsibility and supply chain relationships," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 38(1), pages 37-52, January.
    20. Krus, Lech & Bronisz, Piotr, 2000. "Cooperative game solution concepts to a cost allocation problem," European Journal of Operational Research, Elsevier, vol. 122(2), pages 258-271, April.
    21. Huang, Zhimin & Li, Susan X., 2001. "Co-op advertising models in manufacturer-retailer supply chains: A game theory approach," European Journal of Operational Research, Elsevier, vol. 135(3), pages 527-544, December.
    22. Fu, Yonghui & Piplani, Rajesh, 2004. "Supply-side collaboration and its value in supply chains," European Journal of Operational Research, Elsevier, vol. 152(1), pages 281-288, January.
    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. Cruijssen, F. & Borm, P.E.M. & Fleuren, H.A. & Hamers, H.J.M., 2005. "Insinking : A Methodology to Exploit Synergy in Transportation," Other publications TiSEM 958be918-e7b4-4e46-9cbe-d, Tilburg University, School of Economics and Management.
    2. Cruijssen, Frans & Cools, Martine & Dullaert, W., 2007. "Horizontal cooperation in logistics: opportunities and impediments," Other publications TiSEM ab29fad8-1faf-422b-826e-0, Tilburg University, School of Economics and Management.
    3. Cruijssen, F., 2006. "Horizontal cooperation in transport and logistics," Other publications TiSEM ab6dbe68-aebc-4b03-8eea-d, Tilburg University, School of Economics and Management.
    4. VANOVERMEIRE, Christine & SÖRENSEN, Kenneth & VAN BREEDAM, Alex & VANNIEUWENHUYSE, Bart & VERSTREPEN, Sven, 2012. "Efficient supply chains through flexible horizontal collaboration," Working Papers 2012007, University of Antwerp, Faculty of Business and Economics.
    5. He, Yi & Wang, Hang & Guo, Qiang & Xu, Qingyun, 2019. "Coordination through cooperative advertising in a two-period consumer electronics supply chain," Journal of Retailing and Consumer Services, Elsevier, vol. 50(C), pages 179-188.
    6. Xu, Xiaoyan & Choi, Tsan-Ming & Chung, Sai-Ho & Guo, Shu, 2023. "Collaborative-commerce in supply chains: A review and classification of analytical models," International Journal of Production Economics, Elsevier, vol. 263(C).
    7. Gou, Qinglong & Shao, Jing & Wang, Xin & Yu, Lili, 2020. "Co-op supply chains with a local media company: Models and analysis," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 136(C).
    8. Cruijssen, Frans & Borm, Peter & Fleuren, Hein & Hamers, Herbert, 2010. "Supplier-initiated outsourcing: A methodology to exploit synergy in transportation," European Journal of Operational Research, Elsevier, vol. 207(2), pages 763-774, December.
    9. De Giovanni, Pietro & Karray, Salma & Martín-Herrán, Guiomar, 2019. "Vendor Management Inventory with consignment contracts and the benefits of cooperative advertising," European Journal of Operational Research, Elsevier, vol. 272(2), pages 465-480.
    10. Zhang, Juan & Gou, Qinglong & Liang, Liang & Huang, Zhimin, 2013. "Supply chain coordination through cooperative advertising with reference price effect," Omega, Elsevier, vol. 41(2), pages 345-353.
    11. Guilan Yan & Yi He, 2020. "Coordinating pricing and advertising in a two-period fashion supply chain," 4OR, Springer, vol. 18(4), pages 419-438, December.
    12. Aust, Gerhard & Buscher, Udo, 2012. "Vertical cooperative advertising and pricing decisions in a manufacturer–retailer supply chain: A game-theoretic approach," European Journal of Operational Research, Elsevier, vol. 223(2), pages 473-482.
    13. Devrim Murat Yazan & Vahid Yazdanpanah & Luca Fraccascia, 2020. "Learning strategic cooperative behavior in industrial symbiosis: A game‐theoretic approach integrated with agent‐based simulation," Business Strategy and the Environment, Wiley Blackwell, vol. 29(5), pages 2078-2091, July.
    14. Qinglong Gou & Juzhi Zhang & Juan Zhang & Liang Liang, 2017. "Nash Equilibria of Co-Operative Advertising Programs with Advertising Threshold Effects," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(04), pages 981-1004, July.
    15. Aust, Gerhard & Buscher, Udo, 2014. "Cooperative advertising models in supply chain management: A review," European Journal of Operational Research, Elsevier, vol. 234(1), pages 1-14.
    16. Jørgensen, Steffen & Zaccour, Georges, 2014. "A survey of game-theoretic models of cooperative advertising," European Journal of Operational Research, Elsevier, vol. 237(1), pages 1-14.
    17. Ahmadi-Javid, Amir & Hoseinpour, Pooya, 2012. "On a cooperative advertising model for a supply chain with one manufacturer and one retailer," European Journal of Operational Research, Elsevier, vol. 219(2), pages 458-466.
    18. A. Ahmadi Javid & P. Hoseinpour, 2011. "A Game-Theoretic Analysis for Coordinating Cooperative Advertising in a Supply Chain," Journal of Optimization Theory and Applications, Springer, vol. 149(1), pages 138-150, April.
    19. Karray, Salma & Martín-Herrán, Guiomar & Zaccour, Georges, 2017. "Assessing the profitability of cooperative advertising programs in competing channels," International Journal of Production Economics, Elsevier, vol. 187(C), pages 142-158.
    20. Yu, Lili & He, Xiuli & Zhang, Juan & Xu, Chuanyong, 2021. "Horizontal cooperative advertising with advertising threshold effects," Omega, Elsevier, vol. 98(C).

    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:pal:jorsoc:v:59:y:2008:i:11:d:10.1057_palgrave.jors.2602489. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.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.