Journal of Supply Chain Management Systems

Mahdi Alinaghian ¹, Hamed Amanipour ¹, Erfan Babaee Tirkolaee ¹

Affiliations
1 Department of Industrial and Systems Engineering, Isfahan University of Technology, Isfahan, IR

Abstract

A cross dock is the consolidation point in a distribution network, where multiple smaller shipments can be merged to full truck loads in order to realise economies in transportation. The focus of this study is to evaluate the possibility of considering inventory management structures in order to enhance the quality of solutions achieved by the classical VRP-Cross Dock (VRPCD) modeling. A mixed-integer programming is taken into account for locating cross docks and allocating Pickup and Delivery Nodes to them by considering each node's time window in order to minimise the total transportation costs and inventory holding costs inside each cross dock which is the objective function of the modeling. "Direct Shipment" is used to attach Delivery and Pick-up nodes to cross dock facilities. Determining the necessity and amount of goods transshipment among cross docks is a key point in this modeling which causes a Semi-VMI behaviour by considering cross dock facilities as the coordinator base of the distribution network. The enhancement of the solutions by adding the ability of transshipment between cross docks is proved. Locating cross dock facilities (Strategic decision) while considering other technical issues (Operational decisions) is one of the major contributions of this study.

Keywords

Cross Docking, Inventory Management, Transportation, Mixed-Integer Programming, Facility Location Allocation.

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