Selective Backhauls in Truck Transport with Risk Mitigation: Large Belgian Retailer Case Study

Abstract

In this work the problem of selective backhauls in the transport of fresh products is investigated for the case of a large Belgian grocery retailer. Explicit measures for estimating the risk involved in certain route - vendor backhauling combinations, which emerge from the uncertainties involved in over road transport and unforeseen waiting and loading/unloading times at the depot or stores, are constructed. Two different models are proposed: an integer linear program with chance constraints, and a stochastic linear program. The chance constraints in the first model are based on the intuition and experience of the people in planning and dispatching. In the second model, the balance between risk and potential profit is directly incorporated into the objective function. For this study, the largest of all transport companies working for the studied retailer is considered for reference and data. The stochastic linear program proved to be superior. Moreover, we demonstrate that, even if only considering a small part of the fleet, the potential profits and reduction in empty kilometers due to the selected backhauls are considerable.