Optimal routing and scheduling in E-commerce logistics using crowdsourcing strategies

Abstract

The recent penetration of the internet has enlarged the popularity of online shopping and has given rise to different models of electronic commerce. The growth of this e-commerce creates an opportunity to use new technology and mobile applications to create valuable connections between companies and customers; which gives companies the opportunity to leverage the collective intelligence of theses online communities. This work aims to benefit from these connections to finish the last leg of delivery through the use of crowdsourcing. A pool of citizens are contracted as needed to deliver products from several lockers distributed around the city to consumers' doorsteps. Deliveries occur during a set time window for each customer taking into consideration drivers' capacity and availability time. We propose two Integer Linear programming (ILP) formulations that minimize the total reward paid to crowd-workers through optimum assignment of parcels to drivers and optimum routing for each driver. The proposed models are solved using Lingo optimization software and their run times are compared.