A prototype of a hierarchical global logistics network planning model

Abstract

In this article, we present a prototype Global Logistics (GL) networks planning model in which the GL facilities such as hubs and depots are hierarchically characterised. The proposed method is developed based on the fundamentals of hierarchical cluster analysis and integer programming techniques to determine the corresponding types, locations and numbers of service areas of facilities involved in the proposed GL networks with the goal of minimising the corresponding costs and risks of network configurations. Particularly, the potential risk-oriented costs such as macro-environmental-risk and micro-operational-risk costs are taken into account in the proposal model. In addition, a case study aiming at air express delivery enterprises is conducted to demonstrate the applicability of the proposed methodology.