Emilie Jessula Greening Trade Corridors July 2008
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Emilie Jessula Greening Trade Corridors July 2008
Submitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008nic Institute t Version_Rl -January.2020)Evaluating on-demand warehousing via dynamic facility location modelsKaan Unnu and Jennifer A. PazourIndustrial and Systems Engineering, Rensselaer Polytechnic Institute • Troy, NY, United StatesContact: uiuiuk'g ipi.edu : pazouigrpi.eduAbstract: On-demand wa Emilie Jessula Greening Trade Corridors July 2008rehousing platforms match companies with underutilized warehouse and distribution center capabilities With customers who need extra space or distributEmilie Jessula Greening Trade Corridors July 2008
ion services. These new business models have unique advantages, in terms of reduced capacity and commitment granularity, but also have different cost Submitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008 the three distribution center types (self-distnbution. lease, on-demand) and provides insights for distribution network strategies. Our multi-period facility location model - a mixed-integer linear program - simultaneously determines location-allocation decisions of different distribution center ty Emilie Jessula Greening Trade Corridors July 2008pes with varying commitment granularities and capacity adjustments. Computational experiments consider a wide range of factors and allow statistical eEmilie Jessula Greening Trade Corridors July 2008
valuation on the impact of having the on-demand warehousing alternative available. We show that hybrid network designs that use on-demand in addition Submitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008be influenced by a number of factors, namely on-demand capacity availability, responsiveness requirements, and demand patterns. The study also analyzes capacity flexibility options leased by third-party logistics companies for a premium price and draws attention to the importance of them offering mo Emilie Jessula Greening Trade Corridors July 2008re granular solutions.Keywords: warehouse, distribution, on-demand, shared, pop-up. sharing economy, facility location, mixed-integer programming, netEmilie Jessula Greening Trade Corridors July 2008
work design, supply chain1Submitted - Under Review: Unnu. K. and Pasour, J.A. (2020) Evaluating on-demand warehousing via dynamic facility location moSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008ristics and order profiles: the handlings units are smaller, the delivery' locations are more dispersed, and the customers expect fast and low-cost deliveries. Consequently, nearly half of all US retailers offer same-day delivery, with the majority planning to Within a couple of years (Saleh. 20IS). Emilie Jessula Greening Trade Corridors July 2008 Also, industrial buyers expect to receive their orders Within one or two days from their suppliers (\Vare2Go. 2019).This situation has raised investmEmilie Jessula Greening Trade Corridors July 2008
ents in distribution centers (DCs) and warehouses closer to large population areas (Breedam, 2016). Increasing the number of DCs. and locating them clSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008 outsourcing agreements for distribution services or investing in facility ownership are long-term commitments, which come with overflow or underutilization risks due to demand variability and volatility. Small and medium-sized enterprises (SME) often do not have the capital, nor the qualified workf Emilie Jessula Greening Trade Corridors July 2008orce needed to own and operate such complex distribution networks (Dunke et al., 2016). Finally, the availability of warehouses and DCs is currently lEmilie Jessula Greening Trade Corridors July 2008
imited (Hudson, 2019). To address these challenges, innovative and more flexible business models (Grant. 2017) and new approaches to classic supply chSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008study focuses on how a company can incorporate on-demand distribution models into their distribution network design decisions.On-demand warehousing platforms operate marketplaces to match companies with underutilized warehouse and distribution capabilities With customers who need extra space or dist Emilie Jessula Greening Trade Corridors July 2008ribution services (Forger. 2018; Pazour & Unnu. 2018; SCDigest. 2019; Van der Heide et al.. 2018). Such business-to-business (B2B) models are pan of tEmilie Jessula Greening Trade Corridors July 2008
he sharing economy and collaborative consumption movements (Botsman & Rogers. 2010). They are open, available on-demand, and priced on a per-use basisSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008n-demand warehousing system consists of three primary actors:2Submitted - .Under Xrviiw; thw K. and Patour. J.A. (2020) Evaluating or.-demand yíarchouĩtng V1Emilie Jessula Greening Trade Corridors July 2008
ot to allow customers to access their resources. They are different from traditional suppliers, because generally in on-demand models, outsourcing is Submitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008d also, in some cases, benefit from a more stable workload (O’Brien. 2017). The demand requests are indicated needs for resources made by customers who do not own the resources. The customers’ need for the resource or sen ice is mostly short term and required to be fulfilled immediately (on-demand). Emilie Jessula Greening Trade Corridors July 2008 A central mechanism, also known as a platform, is a third-party organization responsible for managing the interactions between the supply owners andEmilie Jessula Greening Trade Corridors July 2008
the demand requests. The central mechanism owns no resources: instead operates a marketplace and provides access and Visibility to both suppliers and Submitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008 Unnu. 2018).Several companies worldwide operate platforms for on-demand warehouses and DCs. One of the pioneers is Flexe. a US company launched in 2013 that now has more than 1000 warehouses in its network (Forger. 2018). Other US-based platforms include Warehouse Exchange. founded in 2015. Flowspa Emilie Jessula Greening Trade Corridors July 2008ce, founded in 2017. and Ware2go, launched by UPS in 2018. hl Europe. DHL (Germany) recently launched its platform called DHL Spaces (Gesing. 2017). SEmilie Jessula Greening Trade Corridors July 2008
towga (Stowga. 2019). and OneVAST operates in the UK. Stockspots (Stockspots. 2019) in Netherlands, and Waredock (Waiedock. 2019) in Scandinavian counSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008the Philippines (Warehousesolutions. 2019).3Submitted - i-'nclc’-Rwem Unnu. K. and Pazour, JA. (2020) Evaluating on-demand warehousing via dynamic facility location models.Rensselaer Polytechnic Institute (VersÌOH_RỈ _January.2O2O)On-demand systems provide unique advantages, but also create new dyna Emilie Jessula Greening Trade Corridors July 2008mics and risks, and have different cost structures than traditional ways to acquire warehouse space and distribution capabilities. For suppliers and cEmilie Jessula Greening Trade Corridors July 2008
ustomers of this on-demand resource-sharing model, acquiring and lending distribution resources evolves from being a strategic decision to a combinatiSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008lize these strategies specifically for on-demand distribution models. Consequently, the contributions of this paper are summarized as follows.Our paper is the first to formulate an optimization model incorporating on-demand system properties into distribution network design problems. We extend the d Emilie Jessula Greening Trade Corridors July 2008ynamic facility' location problem (DFLPl to simultaneously decide between three types of distribution capabilities (self-distribution. 3PL. lease. on-Emilie Jessula Greening Trade Corridors July 2008
demand). deciding which of these alternatives to use at which locations and how to use these capabilities to meet demand over multiple time periods. TSubmitted - i'nder Review: Unnu. K. and Patữur, J.A. (2020) E\ aluanng on-demand warehousing via dynamic facility location models.Rensselaer Polytechn Emilie Jessula Greening Trade Corridors July 2008, of the distribution center alternatives.Secondly, our model is used to evaluate and provide new insights on how a firm’s distribution strategy-should change with the advent of on-demand warehousing alternatives. A full factorial design of experiment (DOE) captures different environmental and compa Emilie Jessula Greening Trade Corridors July 2008ny factors to answer the open question: under what circumstances is on-demand warehousing beneficial for customers? Our new optimization model IS usedEmilie Jessula Greening Trade Corridors July 2008
to evaluate network design decisions with and without the on-demand alternative being available along With other factors. Then these network designsGọi ngay
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