The Capacitated Transfer Point Covering Problem (TPCP): Expanding Delivery Network Coverage with Minimal Resources
McDougall, Jeffrey Allen
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Retail delivery services have begun using unmanned systems in attempts to reduce the time from a customer’s order to when the product arrives at its intended destination. Utilizing these systems are beneficial to both the customer and retailer, however they create problems for the dispatchers making decisions about the delivery. Promised delivery times are now quick enough that orders cannot be grouped and dispatched at predetermined or cyclic departure times. The limited range of emerging delivery vehicles, specifically unmanned aerial systems, creates gaps in last mile retail distribution networks and excludes significant numbers of potential customers. Distributers must use a two-stage distribution process to increase the vehicle range and include more potential customers. To address the problems created by the dynamic arrival of orders in a two-phase distribution network, this research develops a framework to investigate delivery decisions. It then develops a method to consolidate orders and determine when they should depart the fulfillment facility. Finally, it develops a mathematical program to assign and route orders for delivery in a two-phase distribution network with transfer points. The framework and decision making approaches are then applied to a realistic delivery situation using a distribution case study on the eastern coast of the United States and solved using a commercial simulation and optimization software. The results are analyzed, insights provided, and areas for future research identified.