Abstract
In this article, a dynamic game approach is proposed to deal with the vehicle routing problem with random product returns. A mixed-integer programming model is developed. Then, a three-phase procedure is designed for sequencing the delivery with random returns. The first phase uses a local search-based procedure to generate the initial delivery sequence without returns. Then, the estimated probability of return is embedded in the game model to choose the best near Nash equilibrium solution to modify the delivery sequence. Finally, the distribution sequence is updated with the actual returns for the best-expected pay-off solution. To confirm the advantage of the proposed method, numerical experiments and sensitivity analyses are conducted for a real case of an e-commerce company in Viet Nam.
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