The Optimization of Transportation Costs in Logistics Enterprises during the Covid-19 Pandemic

Abstract

The Covid-19 pandemic has had a significant impact on every industry globally, especially the transportation industry being severely disrupted. With people's travel demand at an all-time low, maintaining the country's transportation infrastructure is crucial to ensure the movement of essential goods. However, the Vietnamese government’s decision to apply social distancing measures to limit and prevent the spread of the disease has generated extreme challenges in the freight transport industry, which have harmed the Vietnamese economy by restricting levels of business activity, causing the movement and distribution of essential commodities to be halted. Based on the practical needs of transportation enterprises, this study proposes a low-cost freight allocation strategy using mix-integer linear programming approaches to ensure an efficient operation for businesses in order to resume normal operations in the context of the Covid-19 epidemic's complex development. The research focuses on developing a mathematical model with an objective function that minimizes total cost and associated constraints. The findings of the study point to the development of a solution that solves businesses problems in determining the optimal transportation plan and assist in making decisions on allocating goods to suitable locations, ensuring the quantity of serving the needs of each district in Ho Chi Minh City, minimizing transportation time while still saving costs. Furthermore, the article aids a decision-making process for other transportation industries.