Order fulfilment problem with time windows and synchronisation arising in the online retailing

Abstract

In this paper, we study the order fulfilment problem with time windows and synchronisation, which arises in the online retailing environment. Given customer orders released in the time window of decision, the online retailer needs to decide which fulfilment centre should fulfil customer orders, how to rigidly coordinate and synchronise operations of different types of vehicles, and how to deliver orders while meeting customers' service time windows, to minimise expenses of order fulfilment. We first introduce a mixed-integer linear programming model, which faces a significant computation burden. To that end, we develop a decomposition-based approach. We conduct extensive experiments to verify the effectiveness of our approach by comparing it with a commercial solver, and a greedy heuristic. We also present managerial insights regarding how our approach could reduce the order transfer operations at the distribution centres and thereby optimise the e-order fulfilment expenses.