Pricing of parcel locker service in urban logistics by a TSP model of last-mile delivery

Abstract

Parcel lockers offer a service for last-mile delivery in urban logistics. To price this service, we identified its values to consignees not at receiving sites and to couriers when delivering parcels to lockers instead of consignees. A travel salesman problem (TSP) model is built to analyze the cost change of last-mile delivery corresponding to the availability of consignees at designated receiving sites. Based on cost evaluation, fees that consignees and couriers should pay respectively are determined based on beneficiary-pay principle. The results of our empirical analyses show that the value of the locker service varies with the terms of express delivery and the availability uncertainty of whether consignees are present at the designated receiving sites, which provides a fundamental pricing basis for locker service providers to charge the couriers or the consignees.