Compromised Network Design Model for the Strategic Alliance of Service Centers and Consolidation Terminals in Express Courier Services

Abstract

택배 영업소 및 화물터미널의 전략적 제휴를 위한절충적 네트워크 설계에 관한 연구The express courier business in Korea has been recognized as one of promising business sectors with the annual growth rate of over 10 percent since 2001. As such, many domestic and foreign companies have been established and are fiercely competing to extend their own market share. The severe competition has forced them to focus on achieving cost competitiveness and high level of customer service. Small and medium-sized enterprises(SMEs) with relatively poor network infrastructure, in particular, are facing tougher challenges to cost reduction and efficiency improvement in their logistics networks. Strategic alliances among SMEs may be an effective way to cope with these challenges. Therefore, this study proposes an integer programming model for compromised network design and its solution procedure based on maxmin and maxsum criteria for strategic alliances. The applicability and efficiency of the proposed model are demonstrated through an illustrative numerical example.