Dynamic bundling and pricing for LTL transport requests in Physical Internet

Bin Qiao (), Shenle Pan () and Eric Ballot ()
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Bin Qiao: CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique
Shenle Pan: CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique
Eric Ballot: CGS i3 - Centre de Gestion Scientifique i3 - Mines Paris - PSL (École nationale supérieure des mines de Paris) - PSL - Université Paris Sciences et Lettres - I3 - Institut interdisciplinaire de l’innovation - CNRS - Centre National de la Recherche Scientifique

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Abstract: This work investigates the dynamic bundling and pricing problem for LTL requests in Physical Internet. From the perspective of carrier, bundling freight transport requests means accepting a package of requests that have synergies on their routes for transport cost reduction. In this work, we consider the situation in which a set of LTL requests with different O-D pairs in a network and carriers should consider request bundling to increase their fill rate and profit. Under combinatorial auction (CA) mechanism, carrier should decide the profitable request bundles that they want to transport and the optimal bidding price to maximize his total profit. Moreover, the future possible requests on the route should also be considered to improve the decision. We propose a mixed integer nonlinear programming (MINLP) model to solve the problem, which optimizes dynamic bundle (route) generation and pricing simultaneously. The model can be used as a decision-making model for carriers to establish real-time transport planning and pricing. A numerical study is constructed to evaluate the feasibility of the proposed model.

Keywords: dynamic pricing; request bundling; less-than-truckload transport; Physical Internet; mixed integer nonlinear programming (search for similar items in EconPapers)
Date: 2019-06-23
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Published in 30th EUROPEAN CONFERENCE ON OPERATIONAL RESEARCH, Jun 2019, Dublin, Ireland

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02081045

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