Time Slot Management in Attended Home Delivery

Authors:
Niels Agatz;Ann Campbell;Moritz Fleischmann;Martin Savelsbergh
Affiliations:
Department of Decision and Information Science, Rotterdam School of Management, Erasmus Univeristy, 3062 PA DR Rotterdam, The Netherlands;Department of Management Sciences, Tipple College of Business, University of Iowa, Iowa City, Iowa 52242;Logistics and Supply Chain Management, University of Mannheim Business School, 68131 Mannheim, Germany;CISRO Mathematics, Informatics, and Statistics, North Ryde, NSW 1670 Australia
Venue:
Transportation Science
Year:
2011

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Abstract

Many e-tailers providing attended home delivery, especially e-grocers, offer narrow delivery time slots to ensure satisfactory customer service. The choice of delivery time slots has to balance marketing and operational considerations, which results in a complex planning problem. We study the problem of selecting the set of time slots to offer in each of the zip codes in a service region. The selection needs to facilitate cost-effective delivery routes, but also needs to ensure an acceptable level of service to the customer. We present a fully automated approach that is capable of producing high-quality delivery time slot offerings in a short amount of time. Computational experiments reveal the value of this approach and the impact of the environment on the underlying trade-offs.