Dynamic pricing of flexible time slots for attended home delivery

In e-commerce, customers are usually offered a menu of home delivery time windows which they need to select exactly one, even though at least some may be more flexible. To exploit the flexibility such customers, we propose introduce flexible slots, defined as any combination regular (not necessarily adjacent). selecting slot (out set that form product), customer agrees informed only shortly prior dispatching vehicle in window goods will arrive. return for providing this flexibility, company offer reduced charge and/or highlight environmental benefits. Our framework also can accommodate customized slots where self-select take place. The routing problem (VRP) presence bookings corresponds VRP with multiple windows. We build on literature demand management and attended delivery, well products. These two concepts have not yet been combined, indeed results from products do carry over directly because future expected implications taken into account. main methodological contribution is development tractable linear programming formulation links decisions cost implications, whilst accounting choice behavior. output program provides information (approximate) opportunity associated specific orders informs dynamic pricing policy slots. Numerical experiments, based realistically-sized scenarios, indicate profit increase significantly depending intensity when adding rather than using