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Abstract

The delivery and pickup of goods from a depot to local customers is an important and practical problem of a logistics manager. In practice, professional logistics company owns more than one depot and the fleet is composed of different types of trucks. This situation is a multi-depot vehicle routing problem with delivery and pickup. When the everyday demand is known, the logistics manger is facing a deterministic multi-depot vehicle routing problem with simultaneously pickup and delivery. In reality, the demands fluctuate over time within a year. When the total demand is greater than the whole capacity of owned trucks, the logistics manager may consider using an outsider carrier to transport a shipment because it may bring significant cost savings to the company. The purpose of this paper is developing a heuristic algorithm not only to route a limited number of trucks from different depots to customers with simultaneously pickup and delivery, but also to make a selection of outsider carriers by minimizing a total cost function. Both the mathematical model and the heuristic algorithm are developed. A variety of test problem were examined. The average percentage deviation from the optimum for the twenty test problems is 1.74% and the execution time for all test problems is less than a second. The results are encouraging as our algorithm obtains the optimal or near-optimal solutions in an efficient way in terms of time and accuracy

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