Freight Consolidation Research Articles

Freight consolidation through carrier collaboration - A cooperative game

Reducing inefficient truck movements, this research investigates the potential of freight consolidation through carrier collaboration. Considering the financial benefits of consolidation as well as the additional cost arising from collaboration, we introduce a cooperative game in which several carriers can collaborate by pooling transportation capacities. Although the core of this game can be empty, we provide three conditions under which core non-emptiness is preserved. Numerical experiments indicate, moreover, that core non-emptiness is also likely outside these conditions.

Evaluating the cost-emissions trade-offs of a modal shift in intermodal and synchromodal transportation planning

Abstract Accepted by: Aris Syntetos Intermodal transportation planning combines road with more sustainable transportation modes to encourage a modal shift. To evaluate the impact of a modal shift on transportation cost and emissions, we propose an intermodal transportation planning model to provide transparency in the cost-emissions trade-off. The model incorporates minimum load requirements, time windows, freight consolidation and stochastic travel times to generate alternative transportation options. It also includes order consolidation to facilitate the utilization of transportation modes that would otherwise be infeasible due to, for instance, minimum load requirements. We also propose a synchromodal planning tool to evaluate re-planning and re-consolidation options in response to disruptions. We numerically illustrate the working of our model using a representative network setting and quantify the trade-offs concerning costs and emissions by evaluating different transportation route options.

Urban Freight Consolidation Model for Post-Hauler Planning

Urban Freight Consolidation Model for Post-Hauler Planning

Improvement of freight consolidation through a data mining-based methodology

Improvement of freight consolidation through a data mining-based methodology

Improving the resilience of the inland river transportation chain with flexible freight consolidation strategy under epidemic

The inland waterway transportation is generally recognized to be the environmentally friendly transportation mode. However, it is relatively weak resilience to the service disruptions. In the post-pandemic era, the regular epidemic prevention is still one of the main considerations for waterway transportation since it undertakes the vast majority of global trade and faces more risk of epidemic spreading. This paper considers a multi-modal transportation system consisted in road network and inland waterway network. The epidemics occur in one or several regions, which would increase the monetary and time cost in the transportation process. We propose the flexible freight consolidation strategy to guide the cargos to be concentrated among the ports via the multi-modal transportation system. The proposed strategy can be built a non-linear mathematical programming model, which can discretized to a 0–1 Knapsack problem by the finite element method and calculated with branch-and-bound algorithm. The Yangtze River Economic Belt is adopted to illustrate validity of the proposed strategy and algorithm.

Hub seaport multimodal freight transport network design: Perspective of regional integration development

To design the multimodal freight transport network of regional hub seaports, and promote the high-quality development of regional economic integration. Combined with the principal component analysis method, the comprehensive evaluation value of the inland cities is determined. Meanwhile, the gravity model is used to obtain the correlation degree between non-core cities and core cities, and the hinterlands of these core cities are divided. The entropy weight TOPSIS model is applied to select the inland hinterland transshipment cities. Taking the minimum total transport costs as the objective function, the regional hub seaport multimodal freight transport network optimization model with space-time constraints is established, and solved by MATLAB software. Taking the freight transport from Chengdu-Chongqing Economic Zone to Yangtze River Delta as an example, a multimodal freight transport network is constructed. It is calculated that Chengdu and Chongqing can be set as freight consolidation centers, and Changsha, Wuhan, Nanchang, Nanjing, Hangzhou, Hefei, Zhengzhou and Xi'an can be set as transshipment nodes. These non-core cities in the Chengdu-Chongqing Economic Zone can be divided into five groups to achieve effective improvement in transport efficiency through group combined transport. This study gives managerial implications for multimodal transport structure optimization and provides reference for the regional integration development between seaports and hinterlands.

Sustainable Urban Freight for Energy-Efficient Smart Cities—Systematic Literature Review

Smart cities need energy-efficient and low-emission transportation for people and goods. Most studies focus on sustainable urban-transportation systems for passengers. Freight transportation in cities has increased significantly during the COVID-19 pandemic, leading to greenhouse gases emissions and negative externalities, such as traffic congestion. The purpose of this paper is to identify through a systematic literature review which innovations (hardware and software) applied by logistics service providers (LSPs) in sustainable urban freight (SUF) are suitable to support the transition to energy-efficient smart cities. We propose to classify the existing innovations in last-mile delivery for SUF into categories: (1) urban freight consolidation and/or trans-shipment; (2) the Consumer as a Service Provider (CaaSP); (3) choice of transportation modes. We introduce the concept of CaaSP as an innovative solution in last-mile delivery (LMD), where customers take over some transport operations with the use of smart technologies, and thus reduce the energy demand. We consider the modes of transportation, such as: drones, autonomous delivery robots, autonomous vehicles, cargo bikes (including e-cargo bikes, e-tricycles), electric vehicles (mainly vans), and combined passenger-and-cargo transportation rapid-transit systems. From the analyzed dataset, we find that energy-efficiency in smart cities can be improved by the consolidation of parcels in micro-depots, parcel lockers, and mobile depots. We analyze smart technologies (the Internet of things, big data, artificial intelligence, and digital twins), which enable energy efficiency by reducing the energy demand (fuel) of SUF, due to better operational planning and infrastructure sharing by logistics service providers. We propose a new IEE matrix as an actionable tool for the classification of innovations applied by LSPs in SUF, according to the level of their interconnectivity and energy efficiency. Additionally, this paper contributes to the theory by exploring possible future research directions for SUF in energy-efficient smart cities.

Breaking truck dominance in supply chains: Proactive freight consolidation and modal split transport

Environmental concerns and a shortage of truck drivers motivate a paradigm shift in truck-dominated supply chains. To alleviate the pressure on truck transport, one can consolidate freight with other companies. Freight consolidation can be facilitated by third-party logistics service providers, who combine shipments that require delivery to the same destination on the same day. More gains can be realized through “proactive freight consolidation”, by proactively synchronizing the timing of shipments prior to placing orders. This is facilitated by a joint replenishment policy. The truck intensity of supply chains can be further reduced by shifting freight from road towards alternative transport modes, such as train. Modal split transport combines two complementary transport modes by using both modes in parallel. We analyze how proactive freight consolidation can be combined with modal split transport. We propose a heuristic that combines a can-order joint replenishment policy to consolidate freight orders proactively via truck, with a tailored base-surge policy to coordinate shipments via train. We develop a lower bound on the optimal cost to validate our heuristic. By comparing the truck usage and cost performance of our policy against alternative replenishment strategies, we show how the combination of proactive freight consolidation and modal split transport can shift freight towards alternative transport modes, without negatively impacting costs or service.

A Branch-Cut-and-Price Approach for the Single-Trip and Multi-Trip Two-Echelon Vehicle Routing Problem with Time Windows

The paper studies the two-echelon capacitated vehicle routing problem with time windows, in which delivery of freight from depots to customers is performed using intermediate facilities called satellites. We consider the variant of the problem with precedence constraints for unloading and loading freight at satellites. In this variant allows for storage and consolidation of freight at satellites. Thus, the total transportation cost may decrease in comparison with the alternative variant with exact freight synchronization at satellites. We suggest a mixed integer programming formulation for the problem with an exponential number of route variables and an exponential number of precedence constraints that link first-echelon and second-echelon routes. Routes at the second echelon connecting satellites and clients may consist of multiple trips and visit several satellites. A branch-cut-and-price algorithm is proposed to solve efficiently the problem. This is the first exact algorithm in the literature for the multi-trip variant of the problem. We also present a postprocessing procedure to check whether the solution can be transformed to avoid freight consolidation and storage without increasing its transportation cost. It is shown that all single-trip literature instances solved to optimality admit optimal solutions of the same cost for both variants of the problem either with precedence constraints or with exact synchronization constraints. Experimental results reveal that our algorithm can be used to solve these instances significantly faster than another recent approach proposed in the literature.

Design of Supply Chain Transportation Pooling Strategy for Reducing CO2 Emissions Using a Simulation-Based Methodology: A Case Study

One of the main concepts for improving the sustainability of supply chains is the collaboration between stakeholders by increasing the efficiency of their shared resources. In the literature, there are many research papers related to vertical collaboration in the logistics industry. However, horizontal collaboration has not received the same degree of attention. In fact, horizontal collaboration such as shared freight carrier and freight consolidation can also be considered vital for low-carbon supply chain solutions. In this paper, the problem of the design of supply chain transportation pooling strategies (SCTPS) is studied, which considers both vertical and horizontal collaboration. The purpose of this paper is to study the impact of these SCTPSs to reduce CO2 emissions using discrete-event simulation (DES)-based methodology. Using a numerical case study of two manufacturing companies and three customers, five SCTPS are studied including the following: (1) non-pooling strategy; (2) multi-pick strategy; (3) multi-drop strategy; (4) central hub strategy; and (5) combined hub and multi-drop strategy. The main result of the study is that all SCTPSs significantly reduce the CO2 emissions compared to the non-pooled supply chain. In fact, the reduction in CO2 emissions can reach 13% compared to the non-pooled strategy. Moreover, the best SCTPS that gives the minimum of CO2 is the hub strategy, followed by the multi-pick strategy and the multi-drop strategy.

Breaking Truck Dominance in Supply Chains: Proactive Freight Consolidation and Modal Split Transport

Breaking Truck Dominance in Supply Chains: Proactive Freight Consolidation and Modal Split Transport

Improvement of freight consolidation through a data mining based methodology

Improvement of freight consolidation through a data mining based methodology

Profitability of freight consolidation facilities: A detailed cost analysis based on theoretical modelling

Consolidated delivery schemes are suggested as policy solutions to address negative externalities caused by growth in last mile deliveries. However, freight consolidation initiatives lack a focus on financial viability early in project design. Dependence on government subsidies is a typical long-term outcome. Thus, this study presents a theoretical cost model to explore the profitability of an inner-city freight consolidation facility and determine the operational variables that derive a profitable facility. The analytical approach develops a mixed integer linear programming cost model to optimise the facility's profitability. A unique aspect is that the model considers the stochastic demand for consolidated delivery services from other freight carriers The numerical solution of the model produced using a genetic algorithm estimated that personnel costs comprise the largest share of total costs. Comprehensive sensitivity analysis reveals that the vehicle fill-in rate has the greatest effect on profitability. Unlike other studies in the literature, this study provides evidence that these facilities could be profitable without government subsidies. The findings offer valuable insights about the development of financial and non-financial incentives to support freight consolidation venture. As a guide for the future, the model provides a theoretical basis to evaluate planned consolidation facilities.

Modeling Freight Consolidation in a Make-to-Order Supply Chain: A Simulation Approach

Shipment consolidation is one of main initiatives to reduce CO2 emissions and transportation cost. It reduces the number of shipments per customer and reduces transportation costs by using larger shipments. This paper investigates the temporal consolidation process in a central consolidation center in a make-to-order supply chain. This research was motivated by a case study of a design furniture company that has many suppliers and customers in large parts of Europe. Simulation was used to check the effect of a new and a special time-based temporal consolidation on the response time in outbound logistics. A soft delivery deadline that is less than the average lead time was used because of the long lead time. Arena Software was used to model the supply chain in order to find the best circumstances to use consolidation. Results showed that temporal consolidation could be more effective when order preparation time is with larger variability. The useful waiting is more when there is at least one order every four days. A formula that approximates the percent of reduced shipments was found. Furthermore, many shipments can be reduced without severely affecting the average response time. The value of the study is that it investigates consolidation problems in a high-mix low-volume environment that was overlooked by previous research.

An iterative two-stage heuristic algorithm for a bilevel service network design and pricing model

Building upon earlier research, we revisit a bilevel formulation of service design and pricing for freight networks, with the aim of investigating its algorithmic aspects. The model adds substantial computational challenges to the existing literature, as it deals with general integer network design variables. An iterative heuristic algorithm is introduced, based on the concepts of inverse optimization and neighbourhood search. The procedure alternates between two versions of restricted formulations of the model while inducing promising changes into the service assignments. The approach has proven a high performance for all of the considered real-world instances. Its efficiency rests on its ability to deliver results within a close proximity to those obtained by the exact solver in terms of quality, yet within a significantly smaller amount of time, and to land feasible solutions for the large-sized instances that could not be previously solved. In line with the sustainable transport goals, a deeper observation of the transport management side highlights the strategy of the algorithm favouring freight consolidation and achieving high load factors.

Modelling individual preferences of goods receivers for a Receiver-led delivery consolidation service

• Proposed consolidation schemes should be optimised to minimise disruption to current delivery practices to goods receivers. • Receivers’ willingness to participate in the RLC service is influenced by the time-window of the consolidated delivery and value-added service. • The willingness-to-pay estimation suggests that businesses might be inclined to pay for a RLC service that could improve the delivery reliability for their orders. There have been various initiatives to consolidate freight deliveries. Researchers have been primarily concerned with assessing the impact upon freight carriers. This study addresses a subject that has received limited attention: Receiver-led delivery consolidation (RLC) policy. The study aims to characterise freight receivers’ preferences for a RLC service and delve more deeply into the most preferred RLC policy variables that could induce receivers’ propensity towards choosing a RLC service. This study estimates behavioural responses of businesses in Melbourne’s CBD, Australia using a mixed logit model a latent-class logit mode with respect to receivers’ preferences for the RLC service as well as quantifying the willingness to pay (WTP) for a RLC delivery service. The modelling results show that the time-window of consolidated delivery and availability of relevant value-added services significantly influence receivers’ preferences. The study findings reveal high preferences for versions of a RLC service that maintain current delivery practices. The results of the WTP calculation suggest that while there might be a net benefit for receivers to pay for services, delivery characteristics of receivers, such as their sub-industry type, highly influence WTP. Future freight consolidation should be optimised by sub-industry and should accommodate as closely as possible the current delivery practices that businesses use. Accordingly, this study proposes suitable configurations of a RLC service based on the individual-level preferences of the most willing sub-industries.

Acyclic Mechanism Design for Freight Consolidation

Freight consolidation is a logistics practice that improves the cost-effectiveness and efficiency of transportation operations, and also reduces energy consumption and carbon footprint. A “fair” shipping cost-sharing scheme is indispensable to help establish and sustain the cooperation of a group of suppliers in freight consolidation. In this paper, we design a truthful acyclic mechanism to solve the cost-sharing problem in a freight consolidation system with one consolidation center and one common destination. Applying the acyclic mechanism, the consolidation center decides which suppliers’ demands ship via the consolidation center and their corresponding cost shares based on their willingness to pay for the service. The proposed acyclic mechanism is designed based on bin packing solutions that are also strong Nash equilibria for a related noncooperative game. We study the budget-balance of the mechanism both theoretically and numerically. We prove a 2-budget-balance guarantee for the mechanism in general and better budget-balance guarantees under specific problem settings. Empirical tests on budget-balance show that our mechanism performs much better than the guaranteed budget-balance ratio. We also study the economic efficiency of our mechanism numerically to investigate its impact on social welfare under different conditions.

A theoretical framework to evaluate the traffic impact of urban freight consolidation centres

City logistics and goods movement using road freight is an outcome of the economic activities that sustain urban life. However, they produce negative externalities like traffic congestion and pollution. There are key areas within cities that are largely affected by logistics activities, such as commercial centres and retail districts. These locations attract many freight vehicles attempting to fulfil deliveries, often with limited parking supply. This results in long queues of delivery trucks waiting for parking spaces or illegal kerbside parking. Therefore, urban planners and decision-makers are motivated to initiate policies that can mitigate these impacts. Urban freight management policies like delivery time or truck size restrictions, and Urban Consolidation Centres (UCC) have been proposed as potential solutions. A UCC is a facility that allows deliveries to be consolidated before entering a busy commercial area. The focus of this study is to offer a theoretical framework for predicting the impact of a UCC on the number of freight trips attracted to a retail district in any city. A mathematical model is developed and used to analyse two possible policy cases concerning the location of a UCC: one where the UCC is located within the retail district, and another where the UCC is located outside the retail district. This model is subsequently applied to examine a retail district in Singapore using real-world data. The critical level of participation in a UCC scheme required for the retail district to experience fewer freight trips is characterised. The results show a diminishing marginal benefit associated with achieving greater consolidation by operating the UCC. This contribution offers a theoretical explanation for the traffic impacts of urban freight consolidation, and aids with the development an ex-ante evaluation of a UCC. The model may be readily applied to any city considering this initiative, by adjusting the model parameters for local conditions.

Multimodal transportation planning with freight consolidation and volume discount on rail freight rate

ABSTRACT This work focuses on freight consolidation in multimodal rail and road transportation. The transportation network comprises of a centralized source warehouse, a set of destination warehouses, and intermediate transshipment terminals. The paper formulates a single period integer programming model and a multi-period constraint programming model for optimizing multimodal freight transportation with volume discount on rail freight rate. The first model is aimed at consignee organizations with comparatively low shipment quantity and less frequent transportation, while the second model targets organizations which require continuous freight transportation on a massive scale. The single-period model is solved using a commercially available CPLEX solver. However, due to the computational complexity of the multi-period constraint programming model, a heuristic named Rail and Truck Allocation Algorithm (RATAA) is proposed. Computational experiments are carried out to prove the efficiency of the proposed solution approaches.

An exact approach for the service network design problem with heterogeneous resource constraints

In this paper, we study the service network design problem with heterogeneous resource constraints (SNDHRC) for one freight consolidation carrier. In this problem setting, there are a finite number of heterogeneous resources assigned to each terminal in the network, and the resources must ultimately return to a home terminal after the transportation service. The SNDHRC is to select services and their schedules, build routes for the heterogeneous resources performing these scheduled services, and move the commodities through the resulting service network such that the total transportation cost is minimized. We first present two formulations for the SNDHRC: node-arc formulation and cycle-path formulation. With the cycle-path formulation, we then propose a branch-and-price approach where cycles for resources and paths for commodities are dynamically constructed. The proposed approach integrates new branching strategies and an acceleration strategy for rapidly finding integer solutions. Computational results are provided and demonstrate efficacy of the proposed exact approach.