Influence of non-price and environmental sustainability factors on truckload procurement process

R. Jothi Basu, Nachiappan Subramanian, Angappa Gunasekaran, P. L.K. Palaniappan

Research output: Contribution to journalArticlepeer-review

12 Scopus citations

Abstract

In practice, manufacturers select their logistics service providers mainly based on total procurement cost. In addition to this, they will also consider allied services such as cargo insurance, electronic documentation, even though practitioners emphasize importance of other factors such as on time delivery and carbon emissions. This study proposes sustainable decision model which includes various non-price and environmental sustainability factors and analyzes their influences in allocating typical routes to the carriers,while establishing a truck load contract. Multiple case studies are carried out in automotive and logistics companies to prioritize factors using Analytic Hierarchy Process (AHP). Factor prioritization is used to formulate carrier assignment problem as a multiple objective optimization model using the influencing factors identified and applies a heuristic methodology to derive the near-optimal solution. This study reveals that carbon footprint, route optimization and on time delivery will have huge impact on procurement decision.

Original languageEnglish (US)
Pages (from-to)363-388
Number of pages26
JournalAnnals of Operations Research
Volume250
Issue number2
DOIs
StatePublished - Mar 1 2017

All Science Journal Classification (ASJC) codes

  • Decision Sciences(all)
  • Management Science and Operations Research

Cite this