A flow allocation strategy for routing over multiple flow classes with an application to air cargo terminals

Advances of information technology have enabled the utilization of automated material handling systems in the logistics industry. The increasing costs of labor in developing countries have accelerated this trend. Major cargo terminals are now installing more and more integrated automated shipment handling systems in order to increase their operational efficiency which can be measured by the average shipping times or the facility throughput, for example. Routing is clearly an important decision category that has significant impact on the operational efficiency. In this paper, motivated by a project with one of the busiest air cargo terminals in the world, we investigate a routing optimization problem for multiple flow classes with different levels of priority. We propose a flow allocation (FA) routing strategy in which when a shipment arrives at a decision point, a set of allocation ratios will be employed to direct it to the next location. These ratios are determined by solving a mathematical model that explicitly considers the congestion effect and the characteristics of the multi-commodity network. Comprehensive simulation experiments demonstrate that the proposed FA routing strategy significantly outperforms the one currently in use.