A parcel locker network as a solution to the logistics last mile problem

Yael Deutsch, Boaz Golany

Research output: Contribution to journalArticlepeer-review

179 Scopus citations

Abstract

We consider the problem of designing a parcel locker network as a solution to the Logistics Last Mile Problem: Choosing the optimal number, locations, and sizes of parcel locekers facilities. The objective is to maximize the total profit, consisting of the revenue from customers who use the service, minus the facilities’ fixed and operational setup costs, the discounts in the delivery costs for customers who need to travel in order to collect their parcels, and the loss of potential customers who are not willing to travel for service. The problem is expressed as a 0–1 integer linear program. We show that it is equivalent to the well-known Uncapacitated Facility Location Problem. We then solve the modified problem, and apply it to an industrial-sized network.

Original languageEnglish
Pages (from-to)251-261
Number of pages11
JournalInternational Journal of Production Research
Volume56
Issue number1-2
DOIs
StatePublished - 17 Jan 2018

Bibliographical note

Publisher Copyright:
© 2017 Informa UK Limited, trading as Taylor & Francis Group.

Keywords

  • E-commerce
  • city logistics
  • design for service
  • facility location
  • mixed integer linear programming
  • supply chain design

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