Although splitting shipments across multiple delivery or transportation modes typically increases total shipping costs as a result of diseconomies of scale, it may offer certain benefits that can more than offset these costs. These benefits include a reduction in the probability of stock-out and in the average inventory costs, as well as a concurrent reduction in transportation congestion. We consider a single-stage inventory replenishment model that includes two transportation modes: a cheaper, less reliable mode that is congested, and another, more expensive but perfectly reliable mode. The high-reliability mode is only utilized in replenishment intervals in which the lead time of the less-reliable mode exceeds a certain value. This permits substituting the high-reliability mode for safety stock, to some degree. We characterize optimal replenishment decisions with these two modes, as well as the potential benefits of simultaneously using two delivery modes.


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    Titel :

    Impacts of Freight Mode Splitting on Congestion, Risk, and Delivery Reliability


    Beteiligte:
    J. Guenes (Autor:in) / C. Perez (Autor:in)

    Erscheinungsdatum :

    2012


    Format / Umfang :

    37 pages


    Medientyp :

    Report


    Format :

    Keine Angabe


    Sprache :

    Englisch




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