Profit Allocation Among Collaborative Companies In Less-than-truckload Industry

In road less-than-truckload (LTL) transportation industry, there exist problems such as the business scale of freight companies is small and the quantity of these companies is large, the industry’s organizational level is low, the market structure is decentralized, the market’s competition is in a disordered situation and the acts of competition are unfair. From 2010, the industry has been integrated. For example, it appears companies in platform pattern like Ka Xing Tian Xia company which mainly integrate line-haul companies, Yi Mi Di Da company which mainly integrate less-than-truckload (LTL) companies, and these coalitions promote collaborations among companies.Though platform and coalition have effects on industry integration, take advantages of each participant’s strengths to make up their own deficiencies, reduce costs, and improve service quality, not all of them could keep a stable relationship for a long time. Profit allocation among participants is the key issue of this problem. In reality, many coalitions are collapsed because of unfair profit allocation and irreconcilable conflicts of interests among participants.Under this circumstance, this paper considers the profit allocation problem of collaborative regional LTL companies after finishing orders on one route. Firstly, we researches on some existed profit allocation problems and methods; secondly, considering the changes of both "profit per cost" and "profit per price" before and after collaboration, we find a method to calculate allocating weights by using Shapley value formula and model the method, then the availability of our method is testified and it satisfies the principles of cooperative game theory; Finally, we use instances to compare allocation results of the method proposed in this paper with previous methods. This paper could provide reference for profit allocation among collaborative companies.