Branch-and-price for a combined order selection and distribution problem in online community group-buying of perishable products

Abstract

As a new social e-commerce model, online community group-buying of perishable products has been under examined. This paper addresses a real-world delivery problem faced in common by an online community group-buying operators, in which operators may suffer revenue loss from product deterioration during delivery. Since delivery quantities of candidate orders may be beyond capacity resources, this paper investigates a new combined order selection and periodic vehicle routing problem with time windows for perishable products. An online community group-buying operator can design daily online community group-buying delivery plan by deciding to serve which customers, to deliver which products and delivery quantities to be transported. To solve this problem, we propose a branch-and-price algorithm that strongly relies on a new label setting algorithm with partial label dominance and a strong bounding strategy based on the definition of Pareto-optimal delivery patterns. Since en-route delivery quantities depend on the interval between two consecutive services, our label setting algorithm is also applicable to the pricing subproblem for the discrete split delivery vehicle routing problem. We conduct a case study on a real-world instance and propose management insights into the structure of delivery plan facing inadequate capacity resources. Numerical experiments on 64 randomly generated instances demonstrate the effectiveness of the proposed branch-and-price algorithm.