The Relationship of Delivery Frequency with the Cost and Resource Operational Efficiency: A Case Study of Jingdong Logistics

Abstract

Under drastic competition, major express companies have increased their daily delivery frequency to improve customer satisfaction and market share. The inverse relationship of frequency with cost and operational efficiency becomes the key to the decision of delivery frequency. This paper uses JD Logistics as an example to quantitatively analyze the relationship mentioned above. The results show that: (1) The cost and resources operational efficiency are closely related to the order splitting ratio under the same delivery frequency; (2) The delivery frequency has different effects on the operational efficiency of the resources in different links. (3) Through the proper splitting and loading of orders, staff scheduling, and area adjustment of delivery station, the optimal delivery frequency can be achieved under the balance of cost and resource operational efficiency. In order to reduce the operating costs of logistics enterprises on the basis of ensuring service levels, one should first properly allocate the amount of orders and splitting ratios to achieve an economic increase in the delivery frequency. In addition, it is important for the logistics enterprises to consider the constraints such as delivery resources and consumer satisfaction to achieve the appropriate decision of delivery frequency. What’s more, it is also crucial to reasonably arrange vehicle loading, staff scheduling and distribution station leasing for the logistics enterprises.