Abstract
Since China started its economic reform, many Hong Kong companies have moved to China. While reducing labor costs, the move has also increased transportation costs. In some cases, transportation cost can reach 30% of total product cost. This work is based on the cargo loading operation of a Hong Kong manufacturer that uses standard containers to ship its products from China, and then onto its customers abroad. Its cargo loading problem is complicated by certain operational constraints. We present several heuristics to solve the problem. Computational tests on the company's actual data indicate an annual saving of over HK$3,000,000, which corresponds to 10.58% of the transportation cost. More importantly, our methods can change the management of the loading operation from the current experience-based system into a systematic, accurate, reliable, and efficient system.
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