Transportation pricing of a truckload carrier

Date
2011
Authors
Toptal, A.
Bingöl, S. O.
Advisor
Instructor
Source Title
European Journal of Operational Research
Print ISSN
0377-2217
Electronic ISSN
1872-6860
Publisher
Elsevier
Volume
214
Issue
3
Pages
559 - 567
Language
English
Type
Article
Journal Title
Journal ISSN
Volume Title
Abstract

Freight transportation is a major component of logistical operations. Due to the increase in global trade, fierce competition among shippers and raising concerns about energy, companies are putting more emphasis on effective management and usage of transportation services. This paper studies the transportation pricing problem of a truckload carrier in a setting that consists of a retailer, a truckload carrier and a less than truckload carrier. In this setting, the truckload carrier makes his/her pricing decision based on previous knowledge on the less than truckload carrier's price schedule and the retailer's ordering behavior. The retailer then makes a determination of his/her order quantity through an integrated model that explicitly considers the transportation alternatives, and the related costs (i.e., bimodal transportation costs) and capacities. In the paper, the retailer's replenishment problem and the truckload carrier's pricing problem are modeled and solved based on a detailed analysis. Numerical evidence shows that the truckload carrier may increase his/her gainings significantly through better pricing and there is further opportunity of savings if the truckload carrier and the retailer coordinate their decisions.

Course
Other identifiers
Book Title
Keywords
Transportation pricing, Supply chain management, Truckload carrier, Less than truckload carrier, Integrated inventory/transportation
Citation
Published Version (Please cite this version)