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A Simulated Annealing Algorithm for Solving Two-Echelon Vehicle Routing Problem with Locker Facilities

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A Simulated Annealing Algorithm for Solving Two-Echelon Vehicle Routing Problem with Locker Facilities algorithms Article A Simulated Annealing Algorithm for Solving Two-Echelon Vehicle Routing Problem with Locker Facilities A. A. N. Perwira Redi 1 , Parida Jewpanya 2,*, Adji Candra Kurniawan 3, Satria Fadil Persada 4, Reny Nadlifatin 5 and Oki Anita Candra Dewi 6 1 Industrial Engineering Department, BINUS Graduate Program—Master of Industrial Engineering, Bina Nusantara University, Jakarta 11480, Indonesia; [email protected] 2 Department of Industrial Engineering, Rajamangala University of Technology Lanna Tak, Tak 63000, Thailand 3 Department of Logistics Engineering, Universitas Pertamina, Jakarta 12220, Indonesia; [email protected] 4 Department of Business Management, Institut Teknologi Sepuluh Nopember, Surabaya 60111, Indonesia; [email protected] 5 Department of Technology Management, Institut Teknologi Sepuluh Nopember, Surabaya 60111, Indonesia; [email protected] 6 Logistics Engineering Department, Universitas Internasional Semen Indonesia, Gresik 61122, Indonesia; [email protected] * Correspondence: [email protected] Received: 6 August 2020; Accepted: 1 September 2020; Published: 3 September 2020 Abstract: We consider the problem of utilizing the parcel locker network for the logistics solution in the metropolitan area. Two-echelon distribution systems are attractive from an economic standpoint, whereas the product from the depot can be distributed from or to intermediate facilities. In this case, the intermediate facilities are considered as locker facilities present in an accessible location in the vicinity of the final customers. In addition, the utilization of locker facilities can reduce the cost caused by the unattended deliveries. The problem is addressed as an optimization model that formulated into an integer linear programming model denoted as the two-echelon vehicle routing problem with locker facilities (2EVRP-LF). The objective is to minimize the cost of transportation with regards to the vehicle travelling cost, the intermediate facilities renting cost, and the additional cost to compensate the customer that needs to travel to access the intermediate facilities. Because of its complexity, a simulated annealing algorithm is proposed to solve the problem. On the other hand, the modelling approach can be conducted by generating two-phase optimization model approaches, which are the p-median problem and the capacitated vehicle routing problem. The results from both methods are compared in numerical experiments. The results show the effectiveness of 2EVRP-LF compared to the two-phase optimization. Furthermore, the simulated annealing algorithm showed an effective performance in solving 2EVRP-LF. Keywords: vehicle routing problem; locker facilities; integer linear programming 1. Introduction E-commerce, also known as electronic commerce, refers to the buying and selling of goods or services using the Internet, and the transfer of money and data to execute these transactions. E-commerce sales worldwide amounted to 1.86 trillion US dollars and projected to grow to 4.48 trillion US dollars in 2021 [1]. The growth of e-commerce has evolved to make products easier to purchase through online retailers and marketplaces. Small businesses and large corporations have all benefited Algorithms 2020, 13, 218; doi:10.3390/a13090218 www.mdpi.com/journal/algorithms Algorithms 2020, 13, 218 2 of 14 from e-commerce, which enables them to sell their goods and services at a scale that was not possible withAlgorithms traditional 2020, o13ffl, xine FOR retail. PEER REVIEW Moreover, the growth of e-commerce is associated with an increasing2 of 14 number of packages delivered to individual customers. Thus, the last mile distribution plays a vital role inthrough serving online customers. retailers and marketplaces. Small businesses and large corporations have all benefited Thefrom last e-commerce, mile distribution which enables are commonly them to sell used their homegoods deliveryand services (HD) at a methods, scale that andwas thenot packagespossible are with traditional offline retail. Moreover, the growth of e-commerce is associated with an increasing delivered directly to the recipients’ site. However, it is seen as a cost-ineffective approach for goods number of packages delivered to individual customers. Thus, the last mile distribution plays a vital distribution.role in serving It is becausecustomers. this approach often met unfortunate condition such as heavy traffic and environmentalThe last issues, mile distribution especially inare the commonly urban area. used Therefore,home delivery the last(HD) mile methods, distribution and the ispackages regarded as the mostare delivered expensive, directly most to polluting, the recipients’ and thesite. leastHowever, efficient it is partseen ofas thea cost-ineffective e-commerce approach supply chain for [2]. Moreover,goods theredistribution. are occasional It is because unattended this approach deliveries often met that unfort can raiseunate thecondition re-delivery such as cost. heavy traffic Customerand environmental pickup (CP) issues, is an especially option for in thethe customers urban area. that Therefore, is considered the last to bemile a less distribution time-consuming is and lessregarded costly as process the most than expensive, the HD. most In polluting, CP, customers and the are least allowed efficient to part pick of upthe ore-commerce deliver the supply packages via intermediatechain [2]. Moreover, facilities there located are occasional nearby the unatten customers’ded deliveries home or that offi cance. raise The customerthe re-delivery pickup cost. locations are usuallyCustomer located inpickup a public (CP) area is an that option is easy for tothe be cu accessed.stomers that A more is considered traditional to form be a ofless parcel time- locker consuming and less costly process than the HD. In CP, customers are allowed to pick up or deliver is seen in the implementation of a reception box which is a fixed locker to receive a package that is the packages via intermediate facilities located nearby the customers’ home or office. The customer installedpickup outside locations a consumer’s are usually home.located Kämäräinenin a public area et al.that [ 3is] showedeasy to be that accessed. the utilization A more traditional of a reception box canform reduce of parcel the locker cost is of seen home in the delivery implementation by 42%. of Lemke a reception et al. box [4 which] found is a that fixed 15% locker of to the receive customer tendsa topackage have more that intentionis installed to outside use the a lockersconsumer’s if it ishome. located Kämäräinen near to their et al. home. [3] showed that the Reverseutilization logistics of a reception is a logistics box can networkreduce the that cost consists of home of delivery activities by 42%. such Lemke as there et al. are [4] flows found of that product goes15% at least of the one customer step back tends in to thehave supply more intention chain. to Business use the lockers activities if it is consist located of near moving to their goods home. from the customerReverse to thelogistics retailer, is a logistics the retailer network to that the consists distributor, of activities and the such distributor as there are to flows the of manufacturer. product The purposegoes at least of thoseone step activities back in the is variedsupply chain. from properBusiness disposal activities atconsist the endof moving of the goods product from life the cycle, refurbish,customer product to the recall, retailer, to the become retailer a partto the of distri the greenbutor, supplyand the chain.distributor These to activitiesthe manufacturer. are beneficial The for purpose of those activities is varied from proper disposal at the end of the product life cycle, a company image which involved a trade-off with the cost required to support the process. Therefore, refurbish, product recall, to become a part of the green supply chain. These activities are beneficial to unlockfor a thecompany full benefits image which of reverse involved logistics a trade-off activities, with the the use cost of required a parcel lockerto support network the process. needs to be furtherTherefore, investigated. to unlock the full benefits of reverse logistics activities, the use of a parcel locker network Ourneeds proposed to be further research investigated. concerns on how to conduct reverse logistics activities such as product return, refurbish,Our proposed and research product concerns recall by on utilizing how to conduc parcelt lockerreverse network.logistics activities The problem such as isproduct addressed as anreturn, optimization refurbish, model and product that formulated recall by utilizing into an parcel integer locker linear network. programming The problem model is addressed denoted as as the two-echelonan optimization vehicle model routing that problem formulated with into locker an integer facilities linear (2EVRP-LF). programming The model objective denoted is to as minimize the the costtwo-echelon of transportation vehicle routing with regardsproblem to with the locker vehicle facilities travelling (2EVRP-LF). cost to pick The objective up the product is to minimize from locker the cost of transportation with regards to the vehicle travelling cost to pick up the product from locker facilities/intermediate facilities, and the additional cost to compensate the customer that needs to travel facilities/intermediate facilities, and the additional cost to compensate the customer that needs to to access the locker. Figure1 shows
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