Replenishment and transportation pricing decisions under two independent carriers with different modes
Author
Bingöl, Safa Onur
Advisor
Toptal, Ayşegül
Date
2009Publisher
Bilkent University
Language
English
Type
ThesisItem Usage Stats
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Show full item recordAbstract
Freight transportation constitutes a substantial cost component in global economics
and consumes significant amounts of energy. With the increasing oil prices, scarcity of
resources and environmental concerns, efficient operation of transportation activities has
become even more important than it was in the past. These raising concerns necessitate the
companies which utilize this activity to plan for transportation more carefully and
conservatively, and the ones that support it to appraise its value more cautiously.
In this thesis, we consider a setting consisting of a retailer, a truck-load carrier and a
less-than-truck-load carrier. We model and solve the retailer’s integrated inventory and
transportation problem under the presence of two modes of carriers. Characterising the
solution for the retailer’s replenishment problem, we then analyze the transportation pricing
decisions of the carriers. We show that substantial savings can be achieved by the retailer due
to integrating inventory and transportation decisions. We also quantify the savings for the TL
carrier and the LTL carrier through carefully determining their transportation price schedules.
Keywords
Transportation pricingTransportation and inventory
Less-than-truckload carrier
Truckload carrier