Modeling a cost benefit transportation model to optimize the redistribution process: Evidence study from Sri Lanka
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Issue
Vol. 6 No. 2 (2021)
Keywords:
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vehicle routing problem, heterogeneous vehicle fleet, redistribution process, heuristic method
Abstract
This study is a case study based on Softlogic Retail (Pvt) Ltd, Sri Lanka, which is a famous consumer electronics company and market leader in Sri Lanka. This company’s outbound logistics have been considered in this research, and they are mainly forced into the redistribution process in Sri Lanka. Extra routing costs due to unreasonable consumption of additional distance have been noticed in the current redistribution process. Here, this problem is modeled as a variant of the vehicle routing problem with a heterogeneous vehicle fleet. Our objective is to minimize warehouse operation, administration, and transportation costs by imposing constraints on capacity and volume. The researchers propose new heuristic solutions to the problem. A proposed heuristic algorithm has been used to find the optimal path between clusters. The computational investigation highlights the cost savings that can be accrued by this new heuristic. The cost savings can be accrued at a rate of as much as 37.5 % compared to the company’s existing method.
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References
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Adipola, D. (2017). Factors affecting waste generation and ways of optimize in fast moving goods industry in Sri Lanka. Cinec Journal.
Bailey, G. (2018). IEM final projects. The concept of strategy as understood in the fields of military planning and business management. Retrieved from: http://bef-battles.org.uk/pdf/methodology_2.pdf
Carr, A. S., & Pearson, J. N. (2002). The impact of purchasing and supplier involvement on strategic purchasing and its impact on firm's performance. International Journal of Operations & Production Management, 22(9), 1032-1053. https://doi.org/10.1108/01443570210440528
Carr, A., & Smeltzer, R. (1999). The relationship of strategic purchasing to supply chain management. European Journal of Purchasing and Supply Management, 5(1), 43–51. https://doi.org/10.1016/S0969-7012(98)00022-7
Demassey, S., Pesant, G., & Rousseau, L. M. (2006). A cost-regular based hybrid column generation approach. Constraints, 11(4), 315-333. https://doi.org/10.1007/s10601-006-9003-7
Fraering, M., & Prasad, S. (1999). International sourcing and logistics: An integrated model. Logistics Information Management, 12(6), 451-460.
Fred R. David (2001). Strategic management: Concepts and cases. New Jersey: Pearson.
Ganepola, D. D., Jayarathna, N. D., & Madhushani, G. (2018). An intelligent cost optimized central warehouse and redistribution root plan with truck allocation system in Colombo region for Lion Brewery Ceylon PLC. Journal of Sustainable Development of Transport and Logistics, 3(2), 66-73. https://doi.org/10.14254/jsdtl.2018.3-2.4
Harps, L. (2000). “The haves and the have nots”: Supply chain practices for the new millenium. Inbound Logistics Journal, 75-114.
Jayarathna, D. G. N. D., Lanel, G. H. J., & Juman, Z. A. M. S. (2019). A contemporary recapitulation of major findings on vehicle routing problems: models and methodologies. International Journal of Recent Technology and Engineering (IJRTE), 8, 581-585. https://doi.org/10.35940/ijrte.B1115.0782S419
Jayarathna, N., Lanel, J., & Juman, Z. A. M. S. (2020). Five years of multi-depot vehicle routing problems. Journal of Sustainable Development of Transport and Logistics, 5(2), 109-123. https://doi.org/10.14254/jsdtl.2020.5-2.10
Jayarathna, N., Lanel, J., & Juman, Z. A. M. S. (2021). Survey on ten years of multi-depot vehicle routing problems: mathematical models, solution methods and real-life applications. Sustainable Development Research, 3(1), 36. https://doi.org/10.30560/sdr.v3n1p36
Klaus, S. (2013). The Future Role of Civil. World Economic Forum.
Knudsen, C. S., & Tsoukas, H. (2001). The Conduct of Strategy Research. In A. Pettigrew, H. Thomas, & R. Whittington (Eds.), Handbook of strategy and management (pp. 413-437). SAGE Publications.
Kraljic, P. (1983). Purchasing must become supply management. Harvard business review, 61(5), 109-117.
Kumar, S. N., & Panneerselvam, R. (2012). A survey on the vehicle routing problem and its variants. Intelligent Information Management, 4(3), 66-74. https://doi.org/10.4236/iim.2012.43010
Lawson, B., Cousins, P. D., Handfield, R. B., & Petersen, K. J. (2009). Strategic purchasing, supply management practices and buyer performance improvement: an empirical study of UK manufacturing organisations. International Journal of Production Research, 47(10), 2649-2667. https://doi.org/10.1080/00207540701694313
Monczka, R. (2009). Purchasing and Supply Chain Management: 4th edition. NY: Centage.
Mwikali, R., & Kavale, S. (2012). Factors affecting the selection of optimal suppliers in procurement management. International Journal of Humanities and Social Science, 2(14), 189-193.
Reck, R., & Long, B. (1988). Purchasing: A competitive weapon. Journal of Purchasing and Materials Management, 24(3), 2–8. https://doi.org/10.1111/j.1745-493X.1988.tb00631.x
Starr, R. M. (1989). The structure of exchange in barter and monetary economies. In General Equilibrium Models of Monetary Economies (pp. 129-143). Academic Press. http://hdl.handle.net/10.2307/1880564
Su, J. (2013). Strategic sourcing in the textile and apparel industry. Industrial Management & Data Systems, 113(1), 23-38. https://doi.org/10.1108/02635571311289647
Thrulogachantar, P., & Zailani, S. (2011). The influence of purchasing strategies on manufacturing performance: An empirical study in Malaysia. Journal of Manufacturing Technology Management, 22(5), 641-663. https://doi.org/10.1108/17410381111134482
Wang, H. S., & Che, Z. H. (2007). An integrated model for supplier selection decisions in configuration changes. Expert Systems with Applications, 32(4), 1132-1140. https://doi.org/10.1016/j.eswa.2006.02.015
World Urbanization Prospects - The 2018 Revision. (2019). Retrieved from https://population.un.org/wup/Publications/Files/WUP2018-Report.pdf.
Zeng, A. Z. (2003). Global sourcing: Process and design for efficient management. Supply Chain Management: An International Journal, 8(4), 367-379. https://doi.org/10.1108/13598540310490125
Authors
Jayarathna, N. D., Lanel, G. H. J., & Juman, Z. A. M. S. (2021). Modeling a cost benefit transportation model to optimize the redistribution process: Evidence study from Sri Lanka. Journal of Sustainable Development of Transport and Logistics, 6(2), 43–59. https://doi.org/10.14254/jsdtl.2021.6-2.3
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