Improving delivery planning via an optimization technique for a case study of a construction material store

Abstract

AbstractThe construction material store (CMS) industry in Thailand is highly competitive, boasting 16,000 stores and experiencing rapid growth (GSB Research). Despite this, back-office management, such as delivery and appointment scheduling, struggles to keep up with the increasing customer demand. The present study aims to develop an operational model for efficient delivery planning in a CMS. The model accurately calculates the minimum delivery costs while adhering to certain constraints. This research employs a mixed-integer linear programming (MILP) mathematical model specifically designed for planning routes and organizing products for delivery. In this study, the CMS delivers products to customers through a third-party trucking company, and a practical delivery plan is developed based on existing conditions and limitations. The delivery plan ensures that products are supplied to customers using appropriate vehicles for the product type, while staying within truckload capacities. The CMS operates by outsourcing vehicles of various sizes, and different products are selected for delivery. All products are available for shipment to customers at any given time. The improved delivery planning considers routing, product selection for trucks, capacity limitations, customer demand, and distance management. Certain limitations of the model, such as routing policy, truck capacity, and product weight, are addressed. The results demonstrate that implementing this model can decrease planning time by up to 80%, reduce total costs by up to 20%, lower delivery distances by up to 19%, and enhance customer satisfaction.

Keywords

• delivery planning
• construction material
• single depot
• split delivery
• heterogeneous fleet
• an optimization model for delivery management