Optimization for transportation outsourcing problems

Abstract

In this study, we consider a transportation outsourcing plan for deciding on the number of self-run and out-sourced trips under stochastic demands. This is an extension of previous work with limitations in terms of computation time and solution accuracy, which restricted it to the solution of problems with small dimensions. This weakness is overcome by the use of two decomposition concepts and trip-adjustment, resulting in four heuristic methods to solve the problem. In addition to the theoretical development of the solution method, the other benefit is that it can practically be applied to the studied carrier, which is expanding its business, or to other large-scale carriers. Finally, we compare the performance of these methods for several instances, showing the different characteristics of the solution methods. The test results demonstrate the applicability of the proposed methods to the solution of large-scale problems.