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Title Evaluation of the cost of time windows in home delivery applications
Author Zuglian, Sara
Supervisor Røpke, Stefan (Logistics & ITS, Department of Transport, Technical University of Denmark, DTU, DK-2800 Kgs. Lyngby, Denmark)
Institution Technical University of Denmark, DTU, DK-2800 Kgs. Lyngby, Denmark
Thesis level Master's thesis
Year 2009
Abstract This thesis deals with a real-life business-to-consumer home delivery case that represents a classical example of Vehicle Routing Problem with Time Windows (VRPTW). There are several trade-o®s that home delivery service providers need to face when designing their order ful¯llment strategy. Delivery time windows represent how long the customers have to stay at home waiting for their delivery. In the attended home delivery case, the customer ser- vice level is directly a®ected by time windows durations: providing convenient time windows improves customer's satisfaction. However, o®ering high level of service by means of tight time windows often results in higher routing costs in terms of number of vehicles needed, time and mileage. Quantitative research on the last mile problem and the factors a®ecting the cost of home delivery has been scarce. The scope of this project is twofold. First, the home delivery problem is in- troduced and an extensive literature review is presented. After that, the L'EASY real-life home delivery case study is described and the trade-o®s that exist among di®erent delivery strategies are examined by means of the following research ques- tions: (1)How is the routing cost a®ected by the enlargement or shrinkage of time windows for all customers? (2)What is the e®ect on the routing cost of assigning di®erent tight time windows to di®erent shares of customers randomly selected? (3)What is the e®ect on the routing cost of assigning narrow time windows to those customers living in the biggest Danish cities? Di®erent scenarios for the L'EASY case study are modeled and solved using Route Planner, a commercial vehicle routing software from Transvision A/S. It is concluded that if the company was considering o®ering a tighter time window to all customers, then the 2-hour time slot represents an appealing alternative. On the other hand, if the company was considering o®ering a tight time window to a speci¯c share of customers who place a higher value on their time and may be will- ing to pay more for a tighter time window, we could recommend di®erent options. In particular, o®ering a higher level of service to the customers living in one of the major Danish cities represents a valid alternative.
Imprint Technical University of Denmark (DTU) : Kgs. Lyngby, Denmark
Keywords Vehicle routing, Time windows, Attended home delivery, Last mile logistics
Original PDF SaraZuglian_MSc.pdf (1.95 MB)
Admin Creation date: 2010-01-06    Update date: 2010-01-28    Source: dtu    ID: 255531    Original MXD