A study of multi-supplier collaborative logistics network with resource sharing under demand uncertainty

Abstract

Due to growing demand and rising cost for delivery services, companies in several sectors have implemented truck sharing to achieve efficient logistics over the past few years. This study proposes a two-stage stochastic program to design multi-supplier collaborative logistics networks with truck sharing under demand uncertainty. The stochastic model optimizes the number of trucks owned by suppliers as a strategic decision and the freight volume by transportation mode and route as operational decisions. By applying the model to a case study of automotive parts delivery in various demand conditions, the impacts of the level and the realization of demand uncertainty on the optimal number of trucks and the objective are evaluated. The results at a variety of demand deviation and skewness show that truck sharing helps to reduce the number of trucks and improve the utilization rate especially when the demand is expected to increase. Furthermore, we demonstrate the performance of the optimal network with respect to synchronous and asynchronous demand for two products by using a simulation-based approach. Our results show that the optimal distribution decisions highly depend on the relationship between the transportation distance and the price of each transportation mode, and truck sharing leads to an economic benefit even when the demand synchronizes.

Keywords

• logistics network
• resource sharing
• two-stage stochastic program
• collaborative logistics