Optimization of Costs in Empty Container Repositioning

Abstract

In this study, the empty container repositioning problem in a liner shipping company is considered. The research includes necessary information about the company and maritime transportation, highlighting the importance of empty container storage. As the worldwide containerized trade increases, the container traffic increases. Consequently, the surplus containers are repositioned to locations where they are required, which causes high costs. Therefore, in the existing system, the company deals with higher prices. In this study, the storage location of the empty containers, which are coming from the vessels to the ports, are determined according to the different cost policies of the warehouses. Thus, our problem is defined as an empty container repositioning problem. The primary objective of this study is to build an operations-research based decision-making system in order to minimize the total cost, regarding changing prices of warehouses and transportation cost of containers. In the decision-making process, this study will help the company to overcome the complexity about repositioning empty containers regarding the container size, storage day of the containers, changing inventory holding costs of the warehouses, and the transportation costs of the containers from port to the corresponding warehouses. Taking into consideration all these parts of the problem, this study will eventually help in reducing inventory holding and transportation costs of the empty container storage. As a solution methodology, the mixed integer linear programming model is proposed, and optimal solutions are obtained in a concise time.