Abstract:
A key decision in transportation supply chain management is the determination of product delivery routes to reach customers as well as the vehicle sizes utilised on each route. The current paper delivery activities at P.T. Tjiwi Kimia Paper Mill may not be optimal in terms of cost indicating room for improvement by either adjusting the routes traversed or examining changes to the vehicle sizes. The NP-hard problem to determine the optimal product delivery routes utilising vehicles of different capacities according to specified time windows is known as the capacitated vehicle routing problem with heterogeneous vehicles and time windows (CVRPHTW). The behaviour of the delivery problem faced by the company is represented mathematically utilising extended two-commodity flow models by considering multiple vehicle sizes and hard time windows as well as road classes as an additional constraint. The models were tested on various benchmark instances from the HVRP website of Duhamel, Lacomme and Prodhon (2016) and the company with satisfactory results. Implementing the results of CVRPH models will reduce the weekly total cost from around IDR 14.5 million to around IDR 10 million which is equivalent to a 31 percent weekly savings although there are six more routes compared to the existing delivery activities. More even utilisation in the size of the vehicles will result as small vehicles will be required to access low-class roads to comply with government regulations. This also means that the cost reduction in carrying a larger quantity of the commodity to serve more distributors cannot be justified by the increase in the amount of fuel consumption on large vehicles.
