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Collaborative shipping under different cost-sharing agreements
Padilla Tinoco, Silvia Valeria Creemers, Stefan Boute, Robert
Padilla Tinoco, Silvia Valeria
Creemers, Stefan
Boute, Robert
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Publication Type
Journal article with impact factor
Editor
Supervisor
Publication Year
2017
Journal
European Journal of Operational Research
Book
Publication Volume
263
Publication Issue
3
Publication Begin page
827
Publication End page
837
Publication NUmber of pages
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Abstract
We study collaborative shipping where two shippers bundle their shipments to share the same transportation vehicle (also known as co-loading). The goal of such a collaboration is to reduce the total number of transports, thereby reducing transportation costs and CO2emissions. To synchronize the replenishment of both companies, we adopt a can-order joint replenishment policy for both companies, and we analyze how the costs of each individual company are impacted by the collaboration. We consider different agreements to redistribute the costs (or the gains) of the collaboration, ranging from no cost redistribution at all, sharing the transportation costs (or its gains) only, to sharing the total logistics costs (or its gains) that are impacted by the collaboration, i.e., transportation + inventory costs. We show that the stability (and thus the long-term viability) of the partnership strongly depends on the cost-sharing agreement, in combination with the allocation mechanism used to share the costs (or gains) of the coordination. Although most companies focus on the redistribution of transportation costs, we show that this might not lead to a stable situation where each individual company eventually benefits from collaboration.
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Keywords
Horizontal Collaboration, Supply Chain Management, Joint Replenishment, Can-Order Policy, Gain Sharing