Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1023132 | Transportation Research Part E: Logistics and Transportation Review | 2015 | 17 Pages |
Abstract
We consider an inventory fulfillment-allocation and transshipment problem in an e-tailing environment. For a typical e-tailer, each customer demand is fulfilled from the closest fulfillment center if there are enough inventories. Otherwise, the e-tailer would transship stock from a nearby facility or transfer the customer order so it is fulfilled from another facility, depending on the economics of transportation. We develop a mixed-integer programming model to help e-tailers optimally fulfill customer orders while minimizing logistics costs. We propose a Benders decomposition-based approach to efficiently find optimal solutions. Our computational results demonstrate the importance of considering inventory transshipments in online deliveries.
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Authors
S.A. Torabi, E. Hassini, M. Jeihoonian,