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ISSN : 2233-4165(Print)
ISSN : 2233-5382(Online)
Journal of Industrial Distribution & Business Vol.9 No.5 pp.25-35

Designing a Distribution Network for Faster Delivery of Online Retailing : A Case Study in Bangkok, Thailand

Chompoonut Amchang*, Sang-Hwa Song**
* First Author, Ph.D. Student, Graduate School of Logistics, Incheon National University, Incheon, Korea. Tel: +82-32-835-8181
** Corresponding Author, Professor, Graduate School of Logistics, Incheon National University, Incheon, Korea. Tel: +82-32-835-8181
March 15, 2018. May 6, 2018. May 15, 2018.


Purpose – The purpose of this paper is to partition a last-mile delivery network into zones and to determine locations of last mile delivery centers (LMDCs) in Bangkok, Thailand. Research design, data, and methodology – As online shopping has become popular, parcel companies need to improve their delivery services as fast as possible. A network partition has been applied to evaluate suitable service areas by using METIS algorithm to solve this scenario and a facility location problem is used to address LMDC in a partitioned area.
Research design, data, and methodology – Clustering and mixed integer programming algorithms are applied to partition the network and to locate facilities in the network.
Results – Network partition improves last mile delivery service. METIS algorithm divided the area into 25 partitions by minimizing the inter-network links. To serve short-haul deliveries, this paper located 96 LMDCs in compact partitioning to satisfy customer demands.
Conclusions –The computational results from the case study showed that the proposed two-phase algorithm with network partitioning and facility location can efficiently design a last-mile delivery network. It improves parcel delivery services when sending parcels to customers and reduces the overall delivery time. It is expected that the proposed two-phase approach can help parcel delivery companies minimize investment while providing faster delivery services.

JEL Classifications: L9, L91, L97, R41.





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