Direct Shipment Research Articles

Inventory reallocation in a fashion retail network: A matheuristic approach

We consider a fashion retail network consisting of a central warehouse, owned by a fashion firm, and a fairly large number of retail stores. Some stores are owned by the firm itself, whereas others are owned by franchisees. An initial inventory allocation decision is made at the beginning of the selling season and is periodically revised. Inventory reallocation comprises both direct shipments from the warehouse to stores and lateral shipments among the stores. Besides stock availability and shipping costs, a suitable reallocation policy must take into account the probability of selling each item, some operational constraints, as well as other preference factors that define the utility of shipping an item from a node of the network to another one. Since the problem does not lend itself to the application of typical tools from inventory theory, we propose an optimization model that complements such tools. The model, given the number of nodes and SKUs, may involve about one million binary variables, and just solving the LP relaxation may take hours using state-of-the-art software. Since typical metaheuristics for combinatorial optimization do not seem a viable alternative, we propose a matheuristic approach, in which a sequence of maximum-weight matching problems is solved in order to reduce the problem and restrict the set of potential shipping pairs, with a corresponding drop in the number of decision variables. Computational results obtained on a set of real-life problem instances are discussed, showing the viability of the proposed algorithm.

A heuristic approach for the integrated production–transportation problem with process flexibility

We study an integrated multi-item production and distribution problem considering a network of multiple plants and clients, who are geographically dispersed, with direct shipments from the plants to the clients. In addition to the decisions on production and distribution, a decision needs to be taken on the level of process flexibility in the network, i.e., which items can be produced in which plants. There is a clear trade-off between these decisions. On the one hand, a network with total flexibility where each plant can produce all types of items allows for lower transportation costs, but requires large investments in flexibility and frequent setups. On the other hand, a network with a limited amount of flexibility where each plant produces only a few items, will increase the transportation costs, but requires a lower investment in flexibility. We model this problem as an extension of the capacitated lot-sizing problem. We limit the investment in flexibility by a budget constraint and minimize the operational costs. Varying this budget allows us to analyze different levels of flexibility. In this paper, we propose mathematical models and a hybrid solution method that combines a mixed integer programming-based approach and a kernel search heuristic. Our computational results using data sets from the literature show that the proposed hybrid method produces on average better solutions with significantly lower computational times when compared with the results produced by a state-of-the-art optimization software. Additional computational results are presented by varying key parameters and analyzing their impact on the value of flexibility. These computational experiments indicate that some of the main managerial insights which were derived in the literature for the case without transportation costs are no longer valid when we consider transportation costs.

Variable Neighborhood Search Algorithm for the Single Assignment Incomplete Hub Location Problem with Modular Capacities and Direct Connections

In distribution systems such as airlines and express package delivery, the use of hub-and-spoke networks is common, and flow consolidation at hub facilities is essential for cost reduction. While a constant discount factor is typically used to model cost reduction in interhub links, this paper explores an extension of the incomplete hub location problem with modular capacity that enables direct connections between non-hub nodes. The modified approach, called MHLPDC, aims to locate a set of hub facilities, connect each non-hub node to a hub, and activate hub facility links, access arc links, and direct links between non-hub nodes to minimize network costs. The MHLPDC integrates link activation decisions into the decision-making process and utilizes modular arc costs to model the flow dependence of transportation costs in all arcs. To solve the problem, the paper presents a mixed-integer mathematical programming formulation and heuristic algorithm based on a greedy randomized adaptive search and variable neighborhood search approach. The proposed algorithm produces high-quality solutions, as demonstrated through computational experiments on benchmark instances with up to 40 nodes. Furthermore, a sensitivity analysis of the optimal network structure indicates that increasing the discount factor, by varying hub and access arc capacities as well as the associated variable costs, results in fewer hubs being established and more direct shipments between non-hub nodes being permitted.

Relay network design with direct shipment and multi-relay assignment

Relay network design with direct shipment and multi-relay assignment

Smart Warehousing as a Wave of the Future

Background: The unprecedented supply chain disruptions caused by the prolonged COVID-19 pandemic forced many firms to change their way of doing business dramatically. These changes include quickly responding to the growing demand for online orders and the corresponding direct shipments to customer locations. These changes have been further accelerated by rapid technological innovations resulting from the fourth industrial revolution (Industry 4.0). One of the most notable technological transformations that we have witnessed is the growing popularity of smart warehousing concepts. Although smart warehousing may represent a wave of the warehousing future, the published literature rarely documents its underlying principles, specific application targets, and potential impacts on supply chain performance. This research aims to identify key drivers of the digital warehousing revolution and describe important value propositions for warehousing automation. Methods: To help companies develop smart warehouses successfully as an integral part of a supply chain link, I conceptualize an ideal smart warehousing system, design its basic architecture, propose specific milestones for monitoring the progress of smart warehouse development, and then, identify critical success factors for its full utilization in today’s volatile warehousing environment. This paper employed qualitative content analysis to conceptualize smart warehousing development and establish a smart warehousing framework. Results: A smart warehouse will bring many managerial benefits, including warehousing cost efficiency, labor productivity, and agility in the era of the knowledge economy. Conclusions: This paper will enable companies to accelerate digital transformation and improve their competitiveness amid the post-pandemic industrial revolution.

A Two-Level Variable Neighborhood Descent for a Split Delivery Clustered Vehicle Routing Problem with Soft Cluster Conflicts and Customer-Related Costs

This paper introduces Split Delivery Clustered Vehicle Routing Problem with Soft cluster conflicts and Customer-related costs (SDCVRPSC) arising in automotive parts of milk-run logistics with supplier cluster distribution in China. In SDCVRPSC, customers are divided into different clusters that can be visited by multiple vehicles, but each vehicle can only visit each cluster once. Penalty costs are incurred when traveling between clusters. The transportation cost of a route is calculated as the maximum direct shipment cost between customers on the route plus the total drop costs. The SDCVRPSC aims to minimize the sum of transportation costs and penalty costs by determining the assignment of customers to vehicles and the visiting order of clusters. We propose an integer linear programming model and a two-level variable neighborhood descent algorithm (TLVND) that includes two-stage construction, intensification at cluster and customer levels, and a perturbation mechanism. Experimental results on designed SDCVRPSC benchmark instances demonstrate that TLVND outperforms the Gurobi solver and two adapted algorithms at the business operation level. Moreover, a real case study indicates that TLVND can bring significant economic savings compared to expert experience decisions. TLVND has been integrated into the decision support system of the case company for daily operations.

Perspective: The Role of Cryopreservation Techniques in Manufacturing, Transport, and Storage of Car-T Therapy Products

Several clinical trials have proved the efficacy and safety of T-cells chimeric antigen receptor (CAR-T cells) in treatment of malignant lymphoma and the first products were registered in the European Union in 2018. The shelf-life of CAR-T cell products in the liquid state is short, so cryopreservation offers a significant benefit for logistics in manufacturing and patient management. Direct shipment of the cryopreserved CAR-T cell therapy products to the clinical department is feasible, nevertheless, intermediate storage in the hospital cryostorage facility gives significant advantage in planning of their administration to patients. Moreover, some manufacturers prefer transport of the starting material cryopreserved at the collection site. The cryopreservation protocol used for starting material by the authors is based on combining dimethyl sulphoxide (DMSO) with hydroxyethyl starch (HES) and slow controlled cooling in cryobags housed in metal cassettes. This achieves the mononuclear cell post-thaw viability of 98.8 ± 0.5 % and recovery of 72.8, ± 10.2 %. Transport of the starting material to the manufactures and return transport of the CAR-T therapy product is performed by authorized courier companies. Intermediate cryostorage of the final CAR-T cell therapy product is performed in a separate dry-storage liquid nitrogen container. On the day of infusion, the cryopreserved products are transported to the clinical department in a dry shipper. On the wards the product is removed from the cassette, inserted into a sterile plastic bag, thawed in a 37 °C water bath followed by immediate intravenous administration. The authors discuss the adherence of the used technology to good manufacturing practice (GMP) principles and genetic safety assurance rules.

An integrated approach for optimizing location-inventory and location-inventory-routing problem for perishable products

The grocery market, especially the perishable product market is under amazing developments in China, accounting for half of overall food expenditure. However, the supply chain of perishable products has encountered serious problems, including significant freight losses, high inventory and transportation costs, etc. To solve these problems, the current paper proposes an integrated approach for simultaneously optimizing the decisions involved in the supply chain, typically including location, inventory, and routing strategy. A three-echelon supply chain including suppliers, DCs and retailers is structured in this paper, with the impacts of whether allowing direct shipment from supplier to retailer being considered. Two typical problems are investigated: location-inventory problem (LIP) and location-inventory-routing problem (LIRP). Mixed integer nonlinear programming model for LIP is proposed while Mixed integer linear programming models for LIRP is proposed, with the objective of minimizing the overall costs of supply chain, which are composed of infrastructure construction costs, transportation costs, inventory costs, and freight losses. CPLEX is used for LIP model solution and a two-stage heuristic algorithm based on Simulated Annealing is designed to solve the LIRP model. The proposed mathematical models and solution method are then applied to a real supply chain network for fresh milk. The optimized results suggest that considering the direct shipment from supplier to retailer is beneficial in terms of reducing the overall supply chain costs by 31%, with 43% reductions in transportation costs, 69.4% reductions in freight losses, 99.4% increases in inventory costs. With the developments of e-retailers for perishable products, allowing the direct shipment from supplier to retailer will bring more benefits in the future.

Optimizing the Distribution Network of a Bakery Facility: A Reduced Travelled Distance and Food-Waste Minimization Perspective

There are many logistics nuances specific to bakery factories, making the design of their distribution network especially complex. In particular, bakery products typically have a shelf life of under a week. To ensure that products are delivered to end-customers with freshness, speed, quality, health, and safety prioritized, the distribution network, facility location, and ordering system must be optimally designed. This study presents a multi-stage framework for a bakery factory comprised of a selection methodology of an optimum facility location, an effective distribution network for delivery operations, and a practical ordering system used by related supply chain actors. The operations function and distribution network are optimized using a multi-criteria decision-making method comprised of the Analytic Hierarchy Process (AHP) to establish optimization criteria and Technique of Order Preference Similarity to the Ideal Solution (TOPSIS) to select the optimal facility location. The optimal distribution network strategy was found using an optimization technique. This framework was applied to a real-life problem for a bakery supply chain in the Western Region, Saudi Arabia. Using a real-life, quantitative dataset and incorporating qualitative feedback from key stakeholders in the supply chain, the developed framework enabled a reduction in overall distribution costs by 14%, decreasing the total travel distance by 16%, and decreasing estimated food waste by 22%. This result was primarily achieved by solving the facility location problem in favor of operating two factories without dedicated storage facilities and implementing the distribution network strategy of direct shipment of products from the bakery to customers.

Transshipment network design for express air cargo operations in China

We introduce a novel multimodal (ground and air transportation) network design model with transshipments for the transport of express cargo with heterogeneous service classes (i.e., next morning delivery, and next day delivery). We formulate this problem using a novel path-based mixed-integer program which seeks to maximize the demand (weight) served. We investigate the value of the proposed transshipment network under various operational conditions and by benchmarking against a direct shipment network and a network with a single transshipment point which mimics a classical star-shaped hub-and-spoke network. Our extensive computational study with real-world data from ShunFeng (SF) Express reveals that the integration of ground and air transportation improves the coverage and that transshipment enables serving a large number of origin–destination pairs with a small number of cargo planes. Importantly, we show that by simplifying handling, i.e., employing cross-docking rather than time-consuming sortation, a transshipment network can transport express cargo fast enough to meet demanding delivery deadlines. Finally, we find that increasing the efficiency of intra-city operations and extending the nightly operating time window are the most effective operational adjustments for further improving the performance of the proposed transshipment network.

18세기 후반~19세기 초 함경도의 유통망 확장과 장시 발달

In the late Joseon Dynasty, Hamgyeong-do was an area where rice distribution was required. In the mid-18th century, the government began promoting direct shipment of rice to the provinces through the establishment of warehouses: Pohang-chang in Gyeongsang-do and Wonsan-chang in Hamgyeong-do. Afterwards, a way to trade Hamgyeong-do’s special products with rice from southern regions was sought at the regional level. As a result, transportation through the port took place briskly. A market network was formed around ports and roads where trade became active. After the late 18th century, the government focused on developing the Hamgyeong-do Bukgwan and border areas between Hamgyeong-do and Pyeongan-do. In this process, inland mountain roads of Hamgyeong-do were actively used. The road network has been reorganized and the market was expanded before the first half of the 19th century. In the market, southern products were also traded, and Hamgyeong-do was included in the nationwide distribution coverage.

Mathematical modeling of Vehicle Routing Problem in Omni-Channel retailing

The biggest challenge that retailers face in satisfying consumer requirements is to ensure an integrated/seamless shopping experience consistent with the purchase, regardless of how the purchase is made. Giant companies have many depots, points of delivery, retail stores, etc. in different cities. This study focused on modeling vehicle routing in a retail distribution network. Goods may be sold in the distribution system addressed in the research model employing two methods: physical and online sales. This study examined the routing problem in the Omni-Channel (OC) retail system, focusing on a multi-objective approach to increase consumer physical convenience (ease of access) using several delivery techniques from six points of delivery. To this end, the optimization of a distribution network was examined through two objective functions. The first objective function minimized the cost of the distribution network, whereas the second maximized customer convenience in terms of the minimum shipment delivery time from the four positions (retail store, intermediate depot, points of delivery, and city distribution center by considering the demand for each product). Two meta-heuristic algorithms, MOGWO and NSGA-II, were used to solve the problem. The results demonstrate that the two-step approach generates smaller objective function values than the second objective function. In addition, the total costs of the two-stage approach were higher than those predicted by the proposed model. Consequently, it was concluded that, in the proposed mathematical model, owing to the integrated optimization of a distribution system and considering the possibility of direct shipment of products to customers, Pareto points are obtained with a lower cost and higher customer satisfaction.

Review: Descendants of Aztec Pictography: The Cultural Encyclopedias of Sixteenth-Century Mexico, by Elizabeth Hill Boone

Review: <i>Descendants of Aztec Pictography: The Cultural Encyclopedias of Sixteenth-Century Mexico</i>, by Elizabeth Hill Boone

Vessel Deployment and De-Hubbing in Maritime Networks: A Case Study on Colombo Port and Its Feeder Market

Generally, vessels are deployed as hub-and-spoke networks to achieve high slot utilization and cost efficiency for shipping lines in global maritime container shipping networks. At the Port of Colombo, most transhipment containers originate from and are destined for Indian ports, the export/import container volume of which has been rapidly increasing, and Indian ports have been developed to accommodate vessel enlargement. In such circumstances, the partial or complete abandonment of a hub (Colombo port) in this region is expected, which is known as “de-hubbing.” This study aims to clarify the impact of port developments and an increase in container cargo demand from the source country on maritime network selection from the perspective of shipping lines. We develop a mixed integer linear programming model to describe vessel deployment, including transhipment via the Colombo port and direct shipment in Indian ports. As a result of the analysis, the number of direct services to Indian ports is expected to increase when the cargo demand of Indian ports increases and the port development of Indian ports is conducted. The progress of the de-hubbing phenomenon decreases vessel size at Colombo port because the container demand at Indian ports is mostly satisfied by newly deployed trunk lines to Indian ports. This study suggests that if Colombo port expects to maintain its hub status, it is critical to consider various other incentives to attract and retain mainline carriers in addition to expanding its port infrastructure. Similarly, if India expects to receive direct calls from mainlines, it is important not only to develop their port infrastructure but also to increase their cargo demand.

Addressing Food Insecurity and Improving Food Allergy Management among Pediatric Patient/Caregiver Dyads During the COVID Pandemic

Food insecurity (FI) is an important social determinant of health associated with greater physical and psychosocial disease burden. During the COVID pandemic, FI has increased substantially, adversely impacting many families managing food allergy and already experiencing challenges accessing safe food. In collaboration with a non-profit food pantry, Food Equality Initiative, we are piloting a 6-month program that provides free monthly direct shipments of self-selected allergen-safe foods to food-allergic children at risk of food insecurity.

Multi‐objective location‐allocation‐routing problem of perishable multi‐product supply chain with direct shipment and open routing possibilities under sustainability

AbstractIn this study, a multi‐objective formulation is proposed for designing a supply chain of perishable products including suppliers, plants, distributors, and customers under sustainable development. In addition to the studies of the literature, direct shipment between producers and customers and also alternative products possibility are allowed. In this problem, the objectives, such as facilities establishment costs, transportation costs, negative environmental impacts, and social impact (fixed and variable employment rates) are optimized simultaneously. As in real situations, most of the transportation activities of such supply chain are performed by hiring transportation devices, the open routing logic is applied to form the traveling path of each hired transportation device. Furthermore, the possibility of direct shipment from the plants to the customers is considered in order to increase profitability of the plants. Because of the NP‐hard nature of the supply chain design problems, some meta‐heuristic solution approaches of the literature are modified to multi‐objective form and applied to solve the problem. Several test problems from small to large sizes are generated randomly to evaluate the meta‐heuristic algorithms. As a result, among the proposed algorithms, the multi‐objective gray wolf optimizer (MGWO) performs better than others by considering four well‐known evaluation metrics. Finally, a case study from perishable products supply chain of Iran is solved and analyzed to show the applicability of the proposed problem.

An integrated production and direct shipment problem in a mining industry

This research aims to solve an integrated production, storage and distribution planning problem in a multi-level multi-product logistics system. The work was conducted in collaboration with a leading mining industry. The present research presents a mixed-integer linear program inspired by the classical Multi-Level Lot-Sizing model to solve the problem. It combines several aspects related to (1) multi-level and multi-product production units, (2) multi-level and multi-product storage units and (3) train transportation with time windows. Besides the standard features of lot-sizing problems, this work encompasses further aspects related to mining activity precisely and, more generally, to the structural specifications of continuous production processes. The objective is to hierarchically satisfy deterministic demand, minimise the total number of switch-offs of production units, and minimise total operational costs. On a sizeable real data-set obtained from our industrial partner, we demonstrate the benefit of integrating decisions in terms of improving demand satisfaction rates, increasing resource efficiency, and minimising total operational costs. In addition, we study the cost structure and provide a detailed cost sensitivity analysis. Finally, this work evaluates the upstream and downstream propagation of decisions in the logistics system and underlines the benefits in terms of flexibility offered by the global approach.

A time-dependent location-routing problem of hazardous material transportation with edge unavailability and time window

The transportation of hazardous materials (hazmat) is an inseparable component of any industrial society, where truck transportation is the most applied transportation solution for hazmat due to its versatility and flexibility, especially for short-distance and direct shipments. This paper explores the application of robust optimization in hazmat location-routing problems with edge unavailability, time-dependent parameters, and delivery time window. To be specific, random disruptions are formulated as a scenario-based robust optimization model, which is integrated with a vehicle routing problem with time windows, and then solved by an augmented epsilon constraint method. In applying the robust optimization, variabilities in cost and risk functions are introduced as critical indicators for designing robust and reliable transportation plans. In the end, the model is applied to a real-world hazmat transportation network, from which practical insights are derived. The resulting assessments shed light on the trade-off between hazmat risk versus cost, and introduce several useful indicators to facilitate the carrier in making appropriate decisions.

Addressing the Location Problem of a Perishables Redistribution Center in the Middle of Europe.

This work aims to contribute to the debate on practical utilization of different location models for consolidation, redistribution, and repackaging centers in a supply chain to optimize shipments, thereby reducing food loss and waste, within the framework of quality of customer service improvement. The scenario in question is the creation of a redistribution center for highly perishable products (fruits and vegetables) from southeast Spain—the leading European supplier—for customers throughout Europe. It is estimated that 10% of exports (more than 530,000 metric tons) from this area are returned by customers due to minor defects. These products cannot be reused and are therefore wasted. Regarding the methodology, comparisons were made between the p-median, gravity p-median, and p-center models. Scenarios of change in demand and randomness in distances were also tested. In addition, the modelling used included the cost and time within a multicriteria optimization framework to assess the possibility of a transport mode change. It was observed, for example, that the gravity p-median model proved useful for perishable products and the logistics strategy chosen. Furthermore, the p-median model displayed strong robustness against long-term changes in demand and random distances. In general, it was demonstrated that this strategy would successfully reduce the response time and distance of shipment from the distribution center to the customers and thereby improve sustainability of the service, reducing the waste related to direct shipments. Furthermore, this research also demonstrated the difficulty of using intermodality in this context, mainly due to transit time, which would undoubtedly increase the waste generated.

Conditions influencing the choice between direct shipment and transshipment in maritime shipping network

This study examines the conditions that influence the choice between direct shipment and transshipment, focusing on two factors: geographical distance and demand. We develop a two-stage model comprising shipping lines and shippers, and apply it to a virtual maritime network with one origin, two destination ports, and one hub port. The generalized costs of shippers in the optimum direct shipment and in transshipment for the shipping lines model are compared to evaluate the choice between direct shipment and transshipment. We find that competitiveness of the port as a hub, indicating the cargo volume aggregated in transshipment, is essential for examining the cost-effectiveness of direct shipment and transshipment. The comparison between the cost-effectiveness of direct shipment and transshipment is based on the configuration of each network, especially in terms of frequency and the vessel size deployed. Direct shipment can be more cost-effective for short distances.