Influence of non-price and environmental sustainability factors on truckload procurement process

R. Jothi Basu (), Nachiappan Subramanian (), Angappa Gunasekaran () and P. L. K. Palaniappan ()
Additional contact information
R. Jothi Basu: Sethu Institute of Technology
Nachiappan Subramanian: The University of Nottingham Ningbo
Angappa Gunasekaran: University of Massachusetts Dartmouth
P. L. K. Palaniappan: Thiagarajar College of Engineering

Annals of Operations Research, 2017, vol. 250, issue 2, No 5, 363-388

Abstract: Abstract In practice, manufacturers select their logistics service providers mainly based on total procurement cost. In addition to this, they will also consider allied services such as cargo insurance, electronic documentation, even though practitioners emphasize importance of other factors such as on time delivery and carbon emissions. This study proposes sustainable decision model which includes various non-price and environmental sustainability factors and analyzes their influences in allocating typical routes to the carriers,while establishing a truck load contract. Multiple case studies are carried out in automotive and logistics companies to prioritize factors using Analytic Hierarchy Process (AHP). Factor prioritization is used to formulate carrier assignment problem as a multiple objective optimization model using the influencing factors identified and applies a heuristic methodology to derive the near-optimal solution. This study reveals that carbon footprint, route optimization and on time delivery will have huge impact on procurement decision.

Keywords: Sustainability; Full truck load; Procurement; Analytic hierarchy process; Non price factors (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (8)

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DOI: 10.1007/s10479-016-2170-z

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