Genetic Algorithm for the Cargo Shunting Cooperation between Two Hub-and-Spoke Logistics Networks

Abstract

Purpose: The overstocked goods flow in the hub of hub-and-spoke logistics network should be disposed of in time, to reduce delay loss and improve the utilization rate of logistics network resources. The problem we need to solve is to let logistics network cooperate by sharing network resources to shunt goods from one hub-and-spoke network to another hub-and-spoke network. Design/methodology/approach: The paper proposes the cargo shunting cooperation between two hub-and-spoke networks. Firstly, a hybrid integer-programming model was established to describe the problem, and then a multi-layer genetic algorithm was designed to solve it and two hub-and-spoke networks are expressed by different gene segments encoded by genes. Data of two third-party logistics companies in southern and northern China are used for example analysis, the sensitivity of parameters controlling the flow in the network and the transportation cost between the two networks is analyzed at the last step. Findings: The hub-and-spoke networks of the two companies in the same area are constructed simultaneously; each hub point that needs to be shunt finds a cooperative hub point in another network. The transfer cost coefficient between two networks and the volume of cargo flow in the network can affect the computation of hubs that needed to be shunt and the corresponding cooperation hubs in the other network. Originality/value: Previous researches on hub-and-spoke logistics network focus on one logistics network, while we study the cooperation and interaction between two hub-and-spoke networks. It shows that two hub-and-spoke network can cooperate across the network to shunt the goods in the hub and improve the operation efficiency of the logistics enterprise.