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Lookup NU author(s): Professor Jingxin DongORCiD
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY-NC-ND).
© 2021 Elsevier LtdBig promotions of online retailers in different shopping festivals often lead to an overwhelming demand surge in parcel delivery. Besides using its own distribution capacity, online retailers usually adopt capacity sharing to cope with the demand surge. Because of the low cost of unmanned distribution, online retailers can adopt unmanned vehicle distribution (UVD) capability sharing. We examine an online retailer's UVD capacity sharing strategies with a logistics firm under demand surge. We develop sharing models under the unilateral and bidirectional option contracts, from which we derive the optimal ex-ante and ex-post sharing strategies and the corresponding initial, option, and total sharing quantities. We find that if the online retailer wants to secure more UVD capacity in advance, it should use the bidirectional option; otherwise, the unilateral option. Moreover, both the initial sharing and total sharing quantities under the unilateral option are greater than those under the bidirectional option, which however can increase the flexibility of the online retailer. We conduct numerical studies to ascertain the effects of the model parameters on the optimal outcomes. The numerical results show that the degree of demand fluctuation has a greater impact on the initial and total sharing quantities under the unilateral option, and has a greater impact on the option sharing quantity under the bidirectional option. Finally, comparing self-built UVD capacity and UVD capacity sharing, we generate insights to provide guidance for the operations of online retailers.
Author(s): Liu S, Hua G, Cheng TCE, Dong J
Publication type: Article
Publication status: Published
Journal: Transportation Research Part E: Logistics and Transportation Review
Year: 2021
Volume: 149
Print publication date: 01/05/2021
Online publication date: 08/04/2021
Acceptance date: 25/03/2021
Date deposited: 31/03/2021
ISSN (print): 1366-5545
ISSN (electronic): 1878-5794
Publisher: Elsevier Ltd
URL: https://doi.org/10.1016/j.tre.2021.102320
DOI: 10.1016/j.tre.2021.102320
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