Vehicle Routing Problem with Cross Docking: A Simulated Annealing Approach

Cross docking is a valuable logistics strategy given that it provides less inventory holding costs, less transportation costs and fast customer deliveries. Cross docking should also be considered in strategic planning since it provides competitive advantage by reducing firm costs. An efficient vehicle routing may even increase the benefits of the cross docking. This study presents a vehicle routing problem in a cross docking setting with heterogeneous vehicles having different capacities. All the routes begin and end at the cross dock and all the pickup and delivery sites are visited by only one vehicle. The aim of this study is to find the routes that minimize total transportation costs and the fixed costs of the vehicles. A simulated annealing algorithm is proposed to solve the problem. The proposed simulated annealing heuristic presents reasonable solutions in terms of computational time, best cost values and the convergence pattern on the best cost.