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Determining the Shape of Delivery Zones to Balance Local and Line Haul Costs
Abstract
This note follows an early work by Newell and Daganzo which suggests a wedge-like zone to divide a service area for freight delivery. Current literature has been largely using the zone of a fixed shape determined solely by demand density. We find that, given the same demand density, the shape of zones could vary significantly in order to better balance local and line haul truck delivery costs which include environmental externalities. A way to determine the optimal shape of truck delivery zones is presented.
Keywords: Freight distribution, continuous approximation, delivery zone, multiple vehicle routing problem.
