Transshipment Vehicle Routing with Pickup and Delivery for Cross-Filling

Abstract

Distribution centers (DCs) typically receive orders from the customers (mostly retail stores) located in their vicinity and deliver the ordered goods the next day morning. To maintain high item fill rate, DCs have to hold a high level of inventory, which will increase inventory cost. As an alternative, cross-filling is that, after closing the daily order receipt, DCs exchange surplus items during the night to reduce the shortage. The economic justification of such cross-filling will depend on the tradeoff between extra transshipment and handling cost versus saved shortage cost. In this paper, as an extension of Rim and Jiang, 2019, vehicles are allowed to drop and pick up items at the intermediate DCs in the route. We present a genetic algorithm to determine the routes and amount to pick up/drop at each DC to minimize the total cost.

Inventory Transshipment Considering Greenhouse Gas Emissions for Sustainable Cross-Filling in Cold Supply Chains

“…Transshipment, or cross-filling, has demonstrated effectiveness as an important supply chain pooling method [11][12][13]. A variety of characteristics of the transshipment problem have been studied [14].…”

“…A transshipment inventory-routing problem was also studied [24]. Transshipment vehicle routing problems were solved using different approaches such as a heuristic algorithm [11] or a mixed-integer programming model [25]. A mathematical model proposed by Vu and Ko permits simultaneous imputation for missing demand data and transshipment decisions, and thus provides proper ways to handle incomplete data situations [5].…”

Integrated Inventory Transshipment and Missing-Data Treatment Using Improved Imputation-Level Adjustment for Efficient Cross-Filling

“…Transshipment or cross-filling has been considered important inventory pooling strategies [1,3,4] for supply chains. Diverse transshipment problems have been studied, depending on inventory conditions and mathematical models [2].…”

“…Diverse transshipment problems have been studied, depending on inventory conditions and mathematical models [2]. Rim and Vu developed a genetic algorithm to solve transshipment vehicle routing with simultaneous pickup and delivery (TVRSPD) problems [1]. A mixed-integer program was suggested for a generalized transshipment problem [5].…”

“…Cross-filling among distribution centers (DCs) has demonstrated its effectiveness in preventing shortages with comparatively low inventory levels at DCs [1][2][3]. The shortage at DCs often leads to a shortage at retail stores, resulting in sales loss and customer dissatisfaction.…”