Package Consolidation Approach For Split Orders In Online Supermarkets With Multiple Warehouses In Multiple Cities

For large-scale online supermarkets with multiple warehouses in multiple cities,a multi-item order(an order contains multiple items)is often split into several suborders and fulfilled by different warehouses.Multiple deliveries of multiple packages for one order in online supermarkets have caused high fulfillment costs,high environmental pollution,and high customer disturbances(the "three highs" problem).The package consolidation approach provides a new way to solve order splitting problems faced by online supermarkets.It can consolidate the suborders together by transshipping the items of suborders to the consolidation warehouses,which can reduce the number of packages of the suborders,thereby effectively reducing the shipping costs,the environmental pollution of packing materials,and the delivery times to customers.However,in order to efficiently fulfill highly personalized split orders with detailed schemes,the package consolidation optimization of suborders faces great challenges in modeling and solving algorithms because it has to deal with a complex NP-hard problem with the block diagonal structure caused by multiple multidimensional decision variables.This research uses theoretical methods,such as cost benefit analysis,combinatorial optimization,multi-commodity network flow,and Benders decomposition algorithm.Following the procedure of "Whether to consolidate" to "How to consolidate",we decompose the problem into two core research problems:a decision problem to determine whether to adopt the package consolidation strategy,and an optimization problem of package consolidation decision schemes.This paper first establishes an economical decision model of the package consolidation strategy,and analyzes the critical values based on key influencing factors,which can provide decision support for online supermarkets on whether the package consolidation strategy should be adopted.Then this paper develops the multi-commodity network flow model for generating package consolidation schemes.With the idea of reducing the solution space,the LBBD decomposition algorithm is proposed,which can provide near-optimal solutions for online supermarkets on how to use the package consolidation strategy with multiple warehouses in multiple cities.The main research work of this paper is as follows:(1)The decision-making process analysis of package consolidation of suborders for online supermarkets with multiple warehouses in multiple cities.Analyze the order fulfillment process and cost structure of the package consolidation strategy;analyze the key factors(such as orders,SKUs,and warehouses)that affect the package consolidation strategy;analyze the process of package consolidation decisions,and make complexity analysis of the decision problem of package consolidation strategy and the optimization problem of package consolidation schemes.(2)The decision model of package consolidation strategy for suborders in online supermarkets with multiple warehouses in multiple cities.By analyzing the resource consumption and cost composition of various operations involved in different order fulfillment strategies,an economical decision model for package consolidation strategy is developed;critical values in two key factors,the number of orders and the average number of suborders in each order,are obtained by analyzing the economical decision model.The enterprise application of the package consolidation strategy is also analyzed.(3)The multi-commodity network flow model for package consolidation schemes in online supermarkets with multiple warehouses in multiple cities.Using the theory of multi-commodity network flow,we analyze the package consolidation optimization problem of suborders,which is an NP-hard problem.The multi-commodity network flow model for package consolidation is proposed by transforming the package consolidation process to the SKU transshipment network flow and package distribution network flow.The idea of solving the model is proposed after the features of the model are analyzed.(4)The LBBD decomposition algorithm for package consolidation schemes in online supermarkets with multiple warehouses in multiple cities.With the block-diagonal feature of the multi-commodity network flow model for package consolidation,a logic-based Benders decomposition algorithm framework is proposed to decompose the original model into the main problem model and several sub-problem models.Based on the features of the transshipment network and shipping network,the new Benders cuts and Cut propagation strategies are also proposed to solve the model,which can quickly and efficiently generate near-optimal package consolidation schemes for suborders in online supermarkets with multiple warehouses in multiple cities.(5)Applied research and method verification.Based on the characteristics of the order data and the item storage configuration of a large-scale online supermarket,numerical experiments are performed to verify the effectiveness and practicability of the proposed package consolidation approach.The efficiency of the LBBD algorithm in solving package consolidation problems is also demonstrated.With sensitivity analysis,managerial insights are provided for enterprises to apply the package consolidation approach.This research conducts a meaningful exploration for solving the package consolidation problem of split orders faced by online supermarkets with multiple warehouses in multiple cities.Moreover,the solution procedure provides a new tool to solve the order fulfillment problem with huge solution space,multiple influence factors,and the complex decision space structure.The research is also helpful to improve the scientificity and practicality of solving complex management decision-making problems.In terms of applications,this research provides decision support for the multi-item order fulfillment optimization in online supermarkets with multiple warehouses in multiple cities.It also provides a scientific and effective solution to the "three highs" problem caused by order splitting.With this research,the order processing efficiency and customer service level of online supermarkets will be promoted,which is useful for China's e-commerce towards precise,efficient,green,and low-carbon development.