The Last Mile: Managing Driver Helper Dispatching for Package Delivery Services

Abstract

Hiring seasonal driver helpers is one widely used approach by parcel delivery companies to deal with increased home‐delivery volumes during peak seasons. Nonetheless, driver helper‐related issues have not received much attention in academic research. This study investigates how driver helpers can be utilized in the most effective way by parcel delivery companies. We show that by separating a parcel delivery route into two sub‐routes, namely “no‐helper” and “with‐helper” routes, the utilization rates of driver helpers can be improved, and the carrier cost be reduced considerably. Three main contributions of this study are as follows. First, based on costtrade‐off insights, we develop a new mathematical model for the last‐mile distribution problem, which we call the Driver Helper Dispatching Problem. Second, using this mathematical model, we perform a series of numerical experiments to identify the conditions under which the proposed “split‐route solution” works most or least effectively. Finally, we perform sensitivity analyses to investigate the impact that changes in model parameters, such as fuel cost, would have on study results.