Innovative Consolidation Techniques for Improved Transportation Efficiency
Author(s)Piechnik, Daniel; Schaufenbuel, Olivia
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Many trucks in the US travel well below permitted cube and volume utilization, so consolidating two or more shipments onto a single multi-stop truckload (MSTL) route can increase truck utilization and decrease transportation costs. Many shippers and carriers lack sufficient network volume, transportation analytics capabilities, and supply network influence to successfully consolidate these loads. However, digital freight brokers often have large network shipment volumes and more advanced transportation analytics capabilities, which positions them to provide value to shipper and carrier partners in their network by identifying and realizing efficiency opportunities. This capstone uses a set-covering formulation of the Practical Pickup and Delivery Problem (PPDP) in combination with clustering and an adapted column generation approach to identify consolidation opportunities. The set covering problem, which is optimized to minimize cost using a mixed integer linear program solver, identified network cost reductions of 11% and a total network route count reduction of approximately 5%. Freight brokers and large transportation operators can use this approach and methodology to identify multi-stop truckload consolidation opportunities that increase transportation network efficiency by eliminating unnecessary truck routes.
Supply Chain Strategy, Urban Logistics, Transportation
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