The Two-Echelon Capacitated Vehicle Routing Problem: Models and Math-Based Heuristics

Multi-echelon distribution systems are quite common in supply-chain and logistic systems. They are used by public administrations in their transportation and traffic planning strategies as well as by companies to model their distribution systems. In the literature, most of the studies address issues related to the movement of flows throughout the system from their origins to their final destinations. A recent trend is to also focus on the management of the vehicle fleets required to provide transportation among the different echelons of the system. The aim of this paper is twofold. First, it introduces the family of Multi-Echelon Vehicle Routing Problems, a term which broadly covers such settings, where the delivery from one or more depots to customers is managed by routing and consolidating freight through intermediate depots. Second, it considers in detail the basic version of Multi-Echelon Vehicle Routing Problems, the Two-Echelon Capacitated Vehicle Routing Problem, which is an extension of the classical VRP where the delivery is compulsory delivered through intermediate depots, named satellites. A mathematical model for Two-Echelon Capacitated Vehicle Routing Problem, some valid inequalities and two math-heuristics based on the model are presented. Computational results up to 50 customers and 4 satellites show the effectiveness of the developed methods.