The Optimization of Transportation Costs in Logistics Enterprises with Time-Window Constraints

Abstract

This paper presents a model for solving a multiobjective vehicle routing problem with soft time-window constraints that specify the earliest and latest arrival times of customers. If a customer is serviced before the earliest specified arrival time, extra inventory costs are incurred. If the customer is serviced after the latest arrival time, penalty costs must be paid. Both the total transportation cost and the required fleet size are minimized in this model, which also accounts for the given capacity limitations of each vehicle. The total transportation cost consists of direct transportation costs, extra inventory costs, and penalty costs. This multiobjective optimization is solved by using a modified genetic algorithm approach. The output of the algorithm is a set of optimal solutions that represent the trade-off between total transportation cost and the fleet size required to service customers. The influential impact of these two factors is analyzed through the use of a case study.