Research opportunities for integrated network design with first and last mile

Supply chain management includes strategic, tactical, and operational decisions for long, medium, and short-term planning. Strategic decisions, such as network design, and operational decisions, such as last-mile routing, have mutual implications. Therefore, modeling them separately can lead to sub-optimal solutions.

Integrated modeling of these decisions has been addressed as a location routing problem (LRP). A new paper based on a critical literature review aims to identify the solution strategies and methods to solve the LRP, as well as related challenges and research opportunities. The findings reveal that 46% of the reviewed publications have adopted a multistage modeling approach to address the LRP, sequentially tackling strategic and operational decisions. Moreover, in addition to the challenge of modeling diverse decision levels, the LRP models must incorporate variables such as time windows, delivery failure rates, demand density, etc.

Five research opportunities are proposed:

1. Modeling the first and last mile with a strategic approach when making strategic network decisions
2. Integrating environmental and social objectives into the modeling framework
3. Applying the solution methods and algorithms to complex real-world cases
4. Exploring competitive and cooperative models in LRP
5. Evaluating the use of emerging technologies.

Source: Arevalo-Ascanio, R., De Meyer, A., Gevaers, R., & Guisson, R., & Dewulf, W. (2024). Location-Routing Problem for Integrated Supply Chain Network Design with First and Last Mile: A Critical Literature Review. Operations and Supply Chain Management: An International Journal, 17(2), 206-219.