for

1st Environmental
IFAC WorkshopSystems
on Integrated Assessment Modelling
1st IFAC Workshop
University onBrescia,
of Brescia,
for Environmental Integrated
Systems Assessment
Italy, May 10-11,Modelling
2018
1st
for IFAC Workshop
Environmental on Integrated Assessment Modelling
Systems
University of Brescia, Brescia, Italy, May 10-11, 2018
Available online at www.sciencedirect.com
for
1st Environmental
IFAC Workshop
University Systems
onBrescia,
of Brescia, Integrated Assessment
Italy, May 10-11,Modelling
2018
University
for of Brescia,
Environmental Brescia, Italy, May 10-11, 2018
Systems
University of Brescia, Brescia, Italy, May 10-11, 2018
ScienceDirect
Attended Home
IFAC PapersOnLine Delivery:
51-5 (2018) 55–60 reducing
Attended Home Delivery: reducing
last-mile environmental
Attended
Attended Home
Home Delivery: impactreducing
Delivery: by changing
last-mile environmental impactreducing
by changing
Attended
last-mile Home
customer
environmental
last-mile environmental Delivery:
habits
impact
impact byreducing
by changing
changing
customer habits
last-mile environmental
customer impact
habits by changing
Daniele Manerbacustomer
∗
Renata Mansini habits∗∗
Roberto Zanotti ∗∗
Daniele Manerbacustomer
∗
∗
Renata Mansini habits∗∗
∗∗
Roberto Zanotti ∗∗
∗∗
∗ Daniele Manerba ∗ Renata Mansini ∗∗ Roberto Zanotti ∗∗
Department of Control Renata
Daniele Manerba and Computer Engineering
Mansini and Zanotti
Roberto ICT for City
∗
∗
Department
Logistics
Daniele and of Control
∗ and
Enterprise
Manerba Computer
(ICE)
Renata Center, Engineering
∗∗
Politecnico
Mansini and
di
Roberto ICT for
Torino City
∗∗
- corso
Zanotti
Department
∗Logistics of Control
and Duca
Enterprise and Computer
(ICE) Center, Engineering
Politecnico and
di ICT
Torino
degli Abruzzi 24, 10129 Torino, Italy for
- City
corso
Department of Control and Computer Engineering and ICT for City
∗Logistics and Duca
Enterprise (ICE)
degli Abruzzi
(e-mail: Center, Politecnico
24, 10129 di Torino - corso
Torino, Italy
daniele.manerba@polito.it)
Department
Logistics of
and DucaControl
Enterprise
degli and Computer
(ICE)
Abruzzi Center,
24, Engineering
Politecnico
10129 Torino, and
di ICT for
Torino
Italy City
- corso
∗∗
Department
Logistics and of (e-mail:
Enterprise
Duca degli daniele.manerba@polito.it)
Information
(ICE)Engineering,
Abruzzi Center,
24, University
Politecnico
10129 Torino, di of Brescia
Torino
Italy - - via
corso
∗∗
∗∗
of (e-mail:
DepartmentDuca (e-mail:
daniele.manerba@polito.it)
Information
Branze 38, Engineering,
25123
degli Abruzzi University
Brescia,
24, 10129 of Brescia - via
Italy Italy
Torino,
daniele.manerba@polito.it)
∗∗ Department of Information
Branze 38, Engineering, University
25123 Brescia,
(e-mail: renata.mansini@unibs.it; Italy
roberto.zanotti@
(e-mail: daniele.manerba@polito.it)
ofunibs.it)
Brescia - via
Department of InformationBranze 38, Engineering,
25123 Brescia, University
Italy of Brescia - via
∗∗ (e-mail: renata.mansini@unibs.it;
Department roberto.zanotti@ unibs.it)
(e-mail: renata.mansini@unibs.it; roberto.zanotti@ofunibs.it)
of Information
Branze 38, Engineering,
25123 Brescia, University
Italy Brescia - via
Branze 38, 25123 Brescia,
(e-mail: renata.mansini@unibs.it; Italy
roberto.zanotti@ unibs.it)
(e-mail: renata.mansini@unibs.it; roberto.zanotti@ unibs.it)
Abstract: Frequently, e-commerce customers pay additional costs for home delivery taking
Abstract:
place in a restrictedFrequently, timee-commerce
window. Wecustomersshow howpay suchadditional
a behaviorcosts for home deliveryintaking
is counterproductive terms
Abstract:
place
of last-mile Frequently,
in a restricted
routing e-commerce
timee-commerce
window.
operations. WeWe customers
show how
consider pay
twopay additional
suchadditional
typical a behavior costs
retailercosts for to
home
is counterproductive
policies delivery
organize taking
theinservice
terms
Abstract:
place indeliveryFrequently,
a restricted time window. We customers
show how such a behavior for home
is counterproductive delivery taking
of
(a last-mile
fastin
Abstract:
place a routing
in a operations.
Frequently,
restricted restricted
time e-commerce
window. WeWe
time consider
interval
customers
show twothe
or
how typical
pay presence
such retailer
additional
a behavior policies
of different
costs
is for to
timeorganize
home windows
counterproductive thein
delivery in
terms
service
for each
taking
terms
of
(a last-mile
fastindelivery
customer) routing
and model operations.
in a operations.
restricted
them We consider
as time interval
optimization twothe
or typical
problems presence retailer
that policies
of different
minimize to organize
time
traveled windows
distance thefor service
each
asservice
main
place
of
(a last-mile
fast a restricted
routing
delivery time
in a restrictedwindow. We
time We show
consider how
two
interval orwethe such
typical a
presence behavior
retailer is counterproductive
policies
of different to organize
time windows the in
forterms
each
customer)
cost
of
(a source
last-mile
fast and
for model
the
routing
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in retailer.
a operations.
restricted as both
optimization
time interval problems
We problems,
consider twothe
or convert
typical that
presence theminimize
obtained
retailer policies
of different traveled
number distance
of
to organize
time kilometers
windows asservice
thefor main
into
each
customer)
cost
gasfast source
emissions and model
for under
the them
retailer.
different as
For optimization
both problems,
scenarios problems
wethe
characterizedconvertbythat minimize
theminimize
obtained
different traveled
number
timetraveled
windows distance
of kilometers
width. foras main
into
Results
(a
customer)
cost delivery
and
source for under in
modela restricted
them
the retailer. as time interval
optimization
Forscenarios
both problems, or
problems presence
we convert that of different
the obtained time
number windows
distance
of kilometers as each
main
into
gas
cost emissions
are extremely
customer)sourceand for under
the different
interesting,
model them
retailer. indicating
asscenarios
For more
optimization
both characterized
problems, sustainable
problems
we convert by different
e-commerce
thattheminimize
obtained time windows
customer-oriented
traveled
number width.
distance
of kilometers Results
strategies.
as main
into
gas
are emissions
extremely different
interesting, indicating more characterized
sustainable by different
e-commerce time windows
customer-oriented width. Results
strategies.
cost
gas source for under
emissions the retailer.
differentForscenarios
both problems, we convert
characterized by the obtained
different number of kilometers into
© 2018,
are IFAC (International
extremely interesting, Federation
indicating ofmore
Automatic Control)
sustainable Hosting
e-commerce by time
Elsevier windows
Ltd. Allwidth.
customer-oriented rights Results
reserved.
strategies.
gas
are emissions
extremely
Keywords: Roadunder different
interesting,
Transport, scenarios
indicating
Greenhouse characterized
moreGas, sustainable
Attended by different
e-commerce
Home Delivery, time windows
customer-oriented width.
Vehicle Routing Results
strategies.
Keywords:
are
Problem,extremely Road
Time Transport,
interesting,
Windows, Greenhouse
indicating
Sustainability moreGas, Attended
sustainable Home Delivery,
e-commerce Vehicle Routing
customer-oriented strategies.
Keywords:
Problem, RoadWindows,
Time Transport, Greenhouse Gas, Attended Home Delivery, Vehicle Routing
Sustainability
Keywords:
Problem, Time RoadWindows,
Transport, Greenhouse Gas, Attended Home Delivery, Vehicle Routing
Sustainability
Keywords:
Problem, RoadWindows,
Time
1. INTRODUCTION Transport, Greenhouse Gas, Attended
Sustainability Home Delivery,
sist of parcels, small packages,Vehicleand Routing
food. Forrester Forecast
Problem, Time Windows, Sustainability
1. INTRODUCTION sist of parcels,
predicts that the small packages,
share and food.
of on-line retailForrester Forecast
will continue to
1. INTRODUCTION sist of steadily
predicts
grow parcels,
that small
the
in the packages,
share of
next and especially
on-line
years food.
retail Forrester
will in Forecast
continue
Italy to
and
When developing1.environmental INTRODUCTION policies, the decision sist of parcels,
predicts that the small packages,
share of Inc.,and food.
on-line Forrester
retailDeliveries Forecast
willincontinue to
1.environmental grow
Spain steadily
(Forrester in Research,
the next years especially
2016). Italy
mayand be
When developing
maker usually looks atINTRODUCTION
taxation and policies, the decision
effective regulations as sistgrow of
predicts parcels,
that
steadily small
the
in the packages,
share of
next and
on-line
years food.
retail Forrester
especially will in Forecast
continue
Italy to
and
When
maker developing
usually looks environmental
at taxation andAs policies,
effective the decision
regulations Spain
performed
as predicts
grow (Forrester
that
steadilyat some
the Research,
collection
share
in Research,
the Inc.,
of Inc.,
next on-line
years 2016).
points retail Deliveries
(postal
especially willoffices, may
incontinue
Italyrecep-be
to
and
possible
When tools to
developing reduce pollution.
environmental stated by
policies, thethedecision
United Spain (Forrester 2016). Deliveries may be
maker
possible usually
tools tolooks
reduceat taxation
pollution. and Aseffective
stated regulations
by the United as performed
tion/delivery
grow
Spain steadilyat some
(Forrester boxes,
in the collection
Research,banks)
next points
or,
years
Inc., as (postal
it happens
especially
2016). offices,
in
Deliveries more
Italyrecep-
may fre-
and
be
States usually
When
maker Environmental
developing looks at Protection
environmental
taxation andAgency,
policies,
effectivepollution
regulationsshould
thethedecision as tion/delivery
performed at some collection points (postal offices, recep-
possible
States tools orto
Environmental reduce pollution.
Protection As stated
Agency, by
pollution United
should quently,
Spain
performed directly
(Forrester boxes,
at some Research,banks)
to collection
the or,
customer
Inc., ashome.
it
2016).
points happens
Notoffices,
Deliveries
(postal more
surprisingly,
may fre-
recep-be
be prevented
maker
possible usually
tools to reduced
looks
reduceat at the and
taxation
pollution. source,
As whenever
effective
stated by the feasible,
regulationsUnited as tion/delivery boxes, banks) or, as it happens more fre-
States
be Environmental
prevented or reduced Protection
at the Agency,
source, pollution
whenever should
feasible, quently,
on-line
performed
tion/delivery directly
shopping
at some to
boxes, the
business customer
collection
banks) highly
points
or, ashome.
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on
(postal
it happenshomesurprisingly,
offices, delivery
morerecep-
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States than
possible controlled.
tools to
Environmental reduce Nevertheless,
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stated
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United
pollutionfeasible,
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customer home.on Not surprisingly,
be
moreprevented
quentlythan or reduced
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behavior at the source,
Nevertheless,
of individuals whenever
at(citizens,
a local level, itshould
customers), as a keyshopping
is fre- tion/delivery
quently, factorboxes,
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forto its banks)
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customer asrelies
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Nevertheless,
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more
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States
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prevented
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controlled. Protection
Nevertheless, Agency,
at the source, at a pollution
whenever
local level, feasible,
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as a key
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factor
delivery for business
is its highly
economic
currently relies
success.
regarded on
as home
Nevertheless,
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the the
most
quently
and
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more their the
prevented
than behavior
cooperation
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with
at the source, (citizens,
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companies
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Nevertheless,
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of individuals
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customers),is fre-
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individuals a concrete difference.
customers),
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least for is its
efficient economic
currently
and most success.
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polluting of the
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In the
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most transportation
onpolluting
environment has
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as one ofportion mostof
and
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the recent
logistics, cooperation
administrations
several years,
attempts with
that can
underhave institutions,
make
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general companies
concrete
name
made todifference.and indeed
ofdevelop
green the
sentedentire supply
several
by chain.
negative
greenhouse Road freight
side-effects
gas (GHG) on transportation
environment
emissions, in has
repre-
particular
In the
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administrations years, under
that can the
make general name
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green sented
difference. expensive,
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reduce made
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while
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transportation sustainable
plays a industrial
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life 2 ,
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consequences congestion
on human and accidents,
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urban
logistics,
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while several
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enhancing of attempts
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reduce made
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accidents, with
Road freight
challenge. The transportation
solutions plays
provided a
by crucial
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plays reduce
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rolelogistics
in The
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work focuses on the last-mile operations support- and accidents,
health and with
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challenge.
are becoming
while
Road Thetransportation
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real
more provided
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sustainable
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challenge.
are The asolutions provided by the green logistics This work focuses on the last-mile
ing the so-called Attended Home Delivery (AHD), that operations support-
mostbecoming
Road significant
freight
challenge. real guide
among
Thetransportation these for
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include
a crucial in The
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are
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the green
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This
ing
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work
quality.
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currently
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focuses
so-called
focuses
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Attended
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Homemodel
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Delivery
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in this support-
sector. that
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include the logistics
The
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currently
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In
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In
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However,
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in modifying
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The
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However, cost Incost
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Copyright inIFAC
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IFAC IAMES 2018
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Brescia, Italy, May 10-11, 2018 Daniele Manerba et al. / IFAC PapersOnLine 51-5 (2018) 55–60
In this paper, we want to analyze the impact of time
windows width on distances traveled by vehicles involved
in last-mile products delivering. Minimization of traveled
distances (number of kilometers) is a classical requirement
imposed by retailers, that aim at maximizing their profits
by reducing costs. This work is a first step of a more
comprehensive study that aims at identifying new method-
ological approaches for pricing attended home services
which will support the fulfillment of customer requests as
well as more economic, environmental-friendly and sus-
tainable delivery concepts. The paper sheds light on the
trade-offs between different retailer policies used for freight
delivery (and the corresponding time windows width and
management), and the total traveled distance (total cost
for the retailer), offering a first insight on environmental
cost impact of AHD services.
We consider two classical situations (distribution policies)
taken into account by retailers when modeling the last-
mile logistics:
• fast delivery (FD): the customers can place their on-
line orders until a predefined deadline, and they will
receive products at home within a guaranteed amount
of time (typically few hours) from such a deadline.
Retailers set such deadlines equally distributed over
the day (e.g. six deadlines from 8 a.m. to 8 p.m.,
one every two hours). This gives rise to a predefined
number of time windows where the vehicles of the
retailers leave the depot and have to come back. The
main feature of this distribution policy is the fastness.
The retailer may be forced to use additional vehicles
to be able to satisfy customers within the restricted
time interval;
• lazy delivery (LD): the customers have to place their
orders in advance the day before the delivery. The
customer can select one of the time windows made
available and he/she will receive the delivery in such
a time interval the next day.
In both cases, we analyze (always from the retailer point
of view) the impact of a policy that modifies the width of
the time window, starting with very restricted interval up
to more extended ones. The aim is to show how the choice
of a customer for a distribution policy instead of the other
one, and of a different time window width in both cases,
can be extremely effective in terms of traveled kilometers,
and thus of environmental impact.
To assess this, we formulate these two policies in terms of
Vehicle Routing Problem (VRP) variants. More precisely,
a VRP with distance/time constraint (DCVRP) is used
for the fast delivery, whereas a VRP with time windows
(VRPTW) is used for the lazy delivery. The mathematical
programming formulations proposed for the two problems
are compact (i.e., they contain a polynomial number of
constraints) and thus can be solved by means of an off-the-
shelf Mixed Integer Linear Programming (MILP) solver.
Then, we test and evaluate the problems on real case
instances provided by a retailer who gave us the historic
data of two days organized as in fast delivery. Instances for
the lazy delivery policy have been generated by combining
the same real-case data.
This paper provides several contributions. We introduce
an interesting comparison between two models for orga-
56
nizing last mile delivery evaluating their relevance both in
terms of economic (retailer costs) and environmental (gas
emissions) impact.
Different analytical models can be used to estimate fuel
consumption and gas emissions. In the literature, three
classes are usually identified:
(1) emission factor models: these models use an emission
converting factor often expressed per unit of distance.
They are mainly used at a macroscale level (regional
or national emission estimations), particularly when
data related to a vehicle’s journey are limited. The
interested readers can find in Esteves-Booth et al.
(2002) a detailed exposition of emission factor models;
(2) average speed models: these models are speed related
functions to estimate emissions at a road network
scale;
(3) modal/instantaneous models: these models operate at
the highest possible level of complexity, and can be
used at a microscale level. Inputs, such as acceleration
and road gradient, are in general drawn from a
running vehicle engine even on a second-by-second
basis.
Given the purpose and the context of our work, our
contribution belongs to the first class, making use of an
emission converting factor to evaluate environmental im-
pact. Computational results show how customer-oriented
policies aiming at sensitizing the customers about the
environmental costs of their decisions could be extremely
effective and help retailers in selecting strategies towards
a more convenient and sustainable economy.
The paper is organized as follows. In Section 2, we pro-
vide a brief analysis on the main contributions on ve-
hicle routing problems including pollution measures and
environmental aspects. In Section 3, we formally describe
the routing problems faced by companies involved with
e-commerce product delivery in restricted time windows.
In Section 4, we provide the mathematical programming
formulation for the problem under the two considered
policies, whereas in Section 5 we show the results obtained
on a set of instances where we systematically changed
the time window width while maintaining unmodified all
remaining data. Finally, Section 6 draws conclusions of the
work and directions for further studies.
2. LITERATURE REVIEW
The ongoing success of e-commerce and on-line retail has
promoted business models providing consumers with di-
rect home deliveries. In particular, attended home delivery
(in which it is required the presence of the customer during
the delivery) is a standard subscription service provided by
the great part of on-line retailers or e-groceries.
For this reason, several works in the specialized literature
have studied the complex tactical problem of balancing
costs and service quality for AHD settings. For example,
Campbell and Savelsbergh (2006) and Klein et al. (2017)
have examined the use of different type of incentives to
influence consumer behavior to reduce delivery costs. More
recently, Agatz et al. (2011) presented a fully automated
approach that is capable of producing high-quality delivery
time-slot offerings in a short amount of time. All these
IFAC IAMES 2018
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studies, however, only consider the service costs for the
retailers, and do not focus on any environmental aspect.
At an operational level, instead, home delivery basically
reduces to the problem of dispatching the orders to a set of
predefined customers with the available fleet of vehicles so
to minimize the cost of the service while guaranteeing that
customers’ demand is satisfied. This actually corresponds
to solving the well-known VRP or one of its variants. The
reader is referred to Toth and Vigo (2014) for a com-
prehensive overview on this broad family of optimization
problems. Furthermore, when considering attended home
delivery, some temporal requirements of the customers
(such as time windows) must be respected as much as
possible and, therefore, the actual VRP must be com-
plicated by embedding scheduling decisions (see Ehmke
and Mattfeld, 2012). As already stated, depending on the
distribution policy implemented (fast or lazy delivery), the
problem becomes a DCVRP or a VRPTW, respectively.
The DCVRP has appeared long time ago. In Laporte et al.
(1984), the authors formulate the problem as an integer
program and propose two exact algorithms for solving it.
Since then, many papers have addressed such a problem
or some of its variants (see, e.g., Laporte et al., 1985, Kek
et al., 2008, Bianchessi et al., 2014, Manerba and Mansini,
2016). The VRPTW is perhaps an even more classical
and studied VRP variant. Practical applications are so
many and the related literature is so vast that we can
just cite some quite recent surveying works (El-Sherbeny,
2010, Desaulniers et al., 2014)
Green logistics is a steadily growing line of research that
aims to minimize the harmful impact and side-effects
of transportation on the environment (emissions, noise,
traffic congestions and accidents). Inside this stream, the
so-called green vehicle routing problems are nothing but
variants of the classical VRP that take into account
broader and more comprehensive objective functions. Such
functions may include greenhouse emissions, fuel, travel
times and their cost other than travel distances (Eglese
and Bektaş, 2014).
In particular, several studies have appeared considering
the minimization of the fuel consumption under the as-
sumption that the vehicle speed is constant or variable.
Concerning the latter, in Bektaş and Laporte (2011), the
authors introduce the Pollution-Routing Problem (PRP)
where vehicle speeds are considered as decision variables.
They propose different mathematical models with or with-
out time windows and perform extended computational
experiments on realistic instances. Franceschetti et al.
(2013) study the same problem also considering the pos-
sibility that data change during the operations (time-
dependent). A very comprehensive survey of green VRP
can be found in Lin et al. (2014).
3. PROBLEMS DESCRIPTION
Both DCVRP and VRPTW are defined over a complete
directed graph G = (V, A) representing the road network,
with node set V := N ∪ {0}, where N is the set of all
the customers, and 0 is an initial depot. The arc set A
is defined as A := {(i, j) : i, j ∈ V, i = j}. For each
arc (i, j) ∈ A, we define as tij the non-negative time
needed to travel from node i to node j, and as dij the
57
57
non-negative distance between node i and node j. We also
define si , i ∈ N , as the time needed to perform the delivery
service at customer i.
Both problems comply with the following common con-
straints:
• each customer i ∈ N has to be visited exactly once;
• at most K vehicles can be used to serve the customers
(limited fleet size);
• each vehicle has to return to the depot within a
predefined time Tmax .
In addition, only in the VRPTW, we define ei and li as
the starting and ending time, respectively, of the time
window selected for the delivery by each customer i. In
our VRPTW, a vehicle is not allowed to start the service
at a customer i before ei and to terminate the service
after li . Note that, as commonly assumed in this type of
problems, a vehicle is allowed to arrive before the time
window opening of a customer and wait.
Both problems look for a solution (i.e., a set of routes
and the relative visiting schedules for the vehicles) that
minimizes the traveled distance while complying with the
specified constraints.
4. MATHEMATICAL FORMULATIONS
In this section, after a presentation of the needed variables
in Section 4.1, we propose a mathematical programming
formulation for the DCVRP (Section 4.2) and for the
VRPTW (Section 4.3). Both formulations are compact
and can therefore be solved by any generic MILP solver. In
order to avoid sub-tours, we introduce constraints similar
to the ones proposed in Maffioli and Sciomachen (1997)
and recently used in Bianchessi et al. (2018).
4.1 Variables definition
Let us define, for each arc (i, j) ∈ A, a binary variable
xij taking value 1 if arc (i, j) is traversed by any vehicle,
and 0 otherwise. Moreover, let us also define, for each arc
(i, j) ∈ A, a continuous variable zij indicating the time on
which a vehicle reaches node j when coming from node i.
Finally, to obtain a MILP formulation for the VRPTW,
we also need to introduce continuous variables wi , i ∈ N ,
representing the time that a vehicle has to wait at node i
before starting the delivery.
4.2 Distance Constrained Vehicle Routing Problem
The Distance Constrained Vehicle Routing Problem can
be formulated as follows:

(DCVRP) min dij xij (1)
(i,j)∈A
subject to
xij = xji = 1 j∈N (2)
i∈V
i∈V
x0j ≤ K (3)
j∈N

xi0 ≤ K (4)
i∈N
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zij − zji = si + tij xij i∈N
j∈V \{i} j∈V \{i} j∈V \{i}
zij ≤ (Tmax − tj0 − sj )xij i ∈ V, j ∈ N
zi0 ≤ Tmax xi0 i ∈ N
zij ≥ (tij + t0i + si )xij i ∈ N, j ∈ V
z0i = t0i x0i i ∈ N
xij ∈ {0, 1} (i, j) ∈ A
zij ≥ 0 (i, j) ∈ A.
The objective function (1) establishes the minimization of
the total distance traveled by all the vehicles. Constraints
(2) impose that each customer is visited exactly once,
whereas constraints (3) and (4) ensure that at most K
vehicles are used to service the customers. Constraint (5)
are flow constraints. They impose that, if a vehicle visits
node j immediately after node i, the time elapsed between
the arrival times in the two nodes is equal to the time si
needed to deliver the items ordered by customer i plus the
travel time tij between i and j. Constraints (6) ensure that
the total time zij needed to arrive in node j is less than
the maximum allowed tour length (Tmax ) minus the time
required to get back to the depot tj0 and the service time
in node j (sj ), for each node j ∈ N . Constraints (7) impose
that the arrival time at the depot of each vehicle is lower
than the maximum allowed tour length Tmax . Constraints
(8) impose a lower bound on variables zij equal to the
time required to travel from node i to node j, plus the
time needed to go from the depot to node i and his service
time si , when arc (i, j) is traversed. Constraints (9) ensure
that the time needed to travel from the depot to any node
i is equal to t0i . Constraints (10)–(11) are binary and non-
negative conditions on variables.
4.3 Vehicle Routing Problem with Time Windows
The Vehicle Routing Problem with Time Windows can be
formulated as follows: 
(VRPTW) min dij xij (12)
(i,j)∈A
subject to (2)–(4), (6)–(11), and
  
zij − zji = si + wi + tij xij i ∈ N (13)
j∈V \{i} j∈V \{i} j∈V \{i}

ei ≤ zji + wi ≤ li − si i∈N
j∈V \{i}
wi ≥ 0 i ∈ V.
The objective function and some of the constraints corre-
spond to the ones already introduced in the formulation
for DCVRP. Constraints (13) are similar to constraints (5),
but for the time a vehicle has to wait at node i (variable
wi ). Constraints (14) are the time window constraints.
They ensure that a customer i receives his order after time
ei and before time li . Constraints (15) are non-negative
conditions on variables wi .
5. EXPERIMENTAL ANALYSIS
The proposed mathematical formulations have been solved
by using Gurobi (version 7.5.2) 1 , one of the most com-
1 http://www.gurobi.com/. Last access on Jan 29, 2018.
(5) petitive commercial solver for MILP problems. A compu-
tational time threshold of 5 hours has been considered for
each instance. The solution used for the following analysis
(6) is the best one found by Gurobi in such a time limit
(7) (possibly the optimal one). The experiments have been
(8) run on a Intel Core i7 5930k machine with 64GB of RAM
(9) and running Windows 7 operating system.
(10)
(11) 5.1 Real-case instances
We test and evaluate the problems on real-case instances
provided by an industrial partner. In particular, the re-
tailer gave us its historical data concerning 2 working days
(8 a.m. - 8 p.m.) organized as in fast delivery with 6 time
intervals of 2 hours in each day. The number of customers
putting a request in each time interval varies from 44 to
79, with an average of about 60. Customers are spread over
the geographical area of an Italian metropolitan city.
We start describing the DCVRP instances generation pro-
cedure. We generate an instance for each pair (day, time
interval), where Tmax is equal to 2 hours, for a total of 12
Basic Instances (BI). These instances correspond to the
real ones solved by the retailer of our case study. Then,
we generate 12 additional instances, called Combined In-
stances (CI), in which we assume that the original time
intervals in BI are combined. In particular, 6 of these
instances have Tmax = 4 hours (CI4), 4 instances have
Tmax = 6 hours (CI6), and 2 instances have Tmax = 12
hours (CI12). The first instance in CI4 is created by
merging the customers of the first 2 intervals of the day,
and assuming a unique time window 8 a.m. - 12 p.m.. The
second one is generated by combining customers in the
third and fourth time windows of the day (12 p.m. - 4
p.m.), and the third one by merging the last 2 intervals of
the day (4 p.m. - 8 p.m.). The first 3 instances correspond
to the first day, whereas the remaining ones are generated
from the second day. Similarly, in group CI6, the first
instance combines the first 3 original intervals (8 a.m. -
2 p.m.) and the second one the last 3 ones (2 p.m. - 8
p.m.). The last 2 instances of this group are generated
from the second day. The last group (CI12) is generated
by combining all the original intervals in each day.
For the VRPTW, we generate 3 instances containing all
the customers of the first 6 BI instances (the first day), and
(14) 3 instances containing all the customers of the last 6 BI
instances (the second day). In particular, in the first one,
(15) each customer inherits the same time window of 2 hours
he has in the corresponding BI instance (TW2), whereas,
in the second one, each customer inherits his 3 hours time
window as in the corresponding CI4 instance (TW4), and
finally the third one as in CI6 instances (TW6).
5.2 Results
Table 1 provides the results obtained when solving the
DCVRP model, corresponding to a FD service. As far
as rows are concerned, the table is divided into 2 parts,
corresponding to the 2 days, consisting of 6 intervals each.
With respect to columns, the table is divided into 4 parts,
corresponding to the results for instances of group BI,
CI4, CI6, and CI12, respectively. Column |N | reports the
number of customers in each interval. This means that, for
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Table 1. Computational results for the DCVRP.

BI CI4 CI6 CI12

Time interval |N | km # gap % km # gap % km # gap % km # gap %
08 a.m. - 10 a.m. 79 1165.99 22 6.4
787.98 11 11.7
10 a.m. - 12 p.m. 44 658.01 12 0.0 816.98 9 11.1
12 p.m. - 02 p.m. 48 679.38 13 3.3
742.21 11 9.7 1094.52 9 11.5
02 p.m. - 04 p.m. 61 950.88 17 4.7
04 p.m. - 06 p.m. 52 749.51 15 5.8 865.79 10 10.4
777.13 11 11.1
06 p.m. - 08 p.m. 70 1012.14 19 7.4
Total km (day 1): 5215.91 2307.32 1682.77 1094.52
08 a.m. - 10 a.m. 59 950.55 17 4.6
734.03 10 10.5
10 a.m. - 12 p.m. 52 829.49 15 6.3 898.62 11 14.7
12 p.m. - 02 p.m. 79 1115.20 21 6.8
800.76 11 9.6 1104.37 9 14.7
02 p.m. - 04 p.m. 50 758.71 14 1.7
04 p.m. - 06 p.m. 75 1014.02 20 4.3 845.37 10 11.6
831.42 12 13.5
06 p.m. - 08 p.m. 53 773.12 15 2.1
Total km (day 2): 5441.09 2366.21 1743.99 1104.37

example, the first instance in CI4 has a total number of
customers equal to 123, corresponding to the sum of the
customers in the first two intervals. Column km shows the
total kilometers traveled by the vehicles in the solution,
whereas column # provides the number of vehicles used
to serve the customers. Finally, column gap % reports
the optimality gap, i.e. the percentage gap between the
objective function value of the incumbent integer solution
and the value of the best lower bound found by Gurobi in
the search tree.
To analyze the impact of changing the width of the time
intervals, we start by looking at the total number of kilo-
meters per day. It is evident how comparing columns BI
and CI4 for the first day, the figure reduces by 55.76%,
which represents the advantage of having a time interval
of 4 hours instead of 2. Similarly, if time intervals are
increased from 2 to 6 hours (i.e., BI vs CI6), the improve-
ment is about 68%. In the second day the corresponding
improving percentages are 56.51% for CI4 and 67.95% for
CI6. Finally, assuming that the customers accept to receive
the service any time of the day (CI12), the improvement is
79.02% in the first day and 79.70% in the second day. Basi-
cally, the larger the time interval, the more the flexibility
of the retailer in organizing the vehicle routing, and the
better the environmental sustainability of the FD service.
This is also evident in the number of vehicles used for
the service, that decreases moving from BI to CI12 in
both days. We recall that the results in the table are the
solutions obtained by Gurobi in 5 hours. Since the MILP
solver is unable to find any optimal solution in such a
time (except for one case), this means that the results
can be further improved, and the reported percentages are
underestimated. Values in column gap % substantiate this
claim: BI instances have a smaller optimality gap, hence
there is a higher chance that their solutions are already
optimal. On the other hand, CI4, CI6, and CI12 instances
have a higher optimality gap and their solutions can likely
improve.
The impact of a change of delivery policy (from FD to LD)
is evident when analyzing Table 2. In this table we provide
the results obtained when solving the VRPTW model,
corresponding to a LD service. Columns are divided into
3 groups, each one corresponding to the results obtained
considering different time windows width. Column |N |
reports the number of customers in the considered day
(which is the sum of the customers in the corresponding
BI instances). Columns km, #, and gap % have the same
meaning as in Table 1.
If we compare the FD policy with 2 hours intervals (BI
instances) and the LD policy with 2 hours time windows
(TW2 instances), the average improvement over the two
considered days in terms of traveled kilometers is 59.36%.
If we consider FD with 4 hours intervals (CI4 instances)
and LD with 4 hours time windows (TW4), the average
improvement is 26.01%. Finally, comparing FD with 6
hours intervals (CI6) and LD with 6 hours time windows
(TW6), we obtain a 12.63% improvement. Since VRPTW
instances are extremely challenging, these results are the
ones that might improve the most from the current value
(as column gap % shows).
5.3 Environmental impact
As already said in Section 1, we are about to assess the
environmental impact of the proposed solutions by using
an emission factor model. This model is the only one
suitable given the macro-scale context of our optimization
planning problems and the limited information available
about the deliveries. Since the trucks used for delivery
in the our case study do not belong to last-generation
vehicles, we can realistically assume a production of 200
grams of CO2 per kilometer. Considering an increase of the
time interval from 2 to 6 hours (i.e., from BI to CI6), this
implies a decrease of 3615 km, on average per day, and,
considering 300 working days in a year, this results in a
saving of 217 tons of CO2 per year, only for the considered
company. If in addition we change the delivery policy from
FD (with 2 hours intervals) to LD (with 6 hours time
windows), the reduction is 230 tons of CO2 per year. If we
change the delivery policy from FD to LD, but we compare
an FD with 2 hours intervals with a 2 hours time window
LD (i.e. the time a customer has to wait for a package is
the same), we obtain a saving of 190 tons of CO2 per year.
6. CONCLUSIONS
On the site of the European Environmental Agency it is
written that freight transportation is predicted to grow by

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80% from 2013 to 2050 in Europe. Given this trend, it is of
crucial importance to drive individuals and companies to
find more environmentally-friendly solutions. At this aim,
negative externalities such as environmental impact should
not be ignored in cost evaluation. Economic incentives
and differential prices can represent a way to internalize
negative externalities. The present work has shown that
knowing in advance the customers to serve allows a better
service organization, and reduces both the number of vehi-
cles used and the number of traveled kilometers, massively
impacting on the CO2 emissions’ reduction. If the retailer
adopts a fast delivery service, the environmental impact in
terms of kilometers grows at a rate of almost 400%, when
reducing the time interval width from the whole day down
to 2 hours.
The present analysis has been conducted at a tactical
planning level. However, emissions do not depend only on
the number of kilometers, but also on the type of fuel,
the engine technology (vehicle type) as well as the speed,
the load of the vehicle and the driving behavior. For this
reason, our intention is to consider in the next future
the environmental impact of the studied problems taking
into account alternative objective functions (other than
distance traveled) and more complex fuel consumption
models. Another interesting aspect to consider could be
the uncertainty related in particular to the traveling times
(Gendreau et al., 1996, Beraldi et al., 2017). In real
situations, in fact, traffic congestion or road accidents
might completely destroy the advantage of using routes
that are very green when planned on expected data.
Finally, even more complex routing problems (see, e.g.,
Manerba et al., 2017) may be considered for a similar
assessment.
Table 2. Computational results for the VRPTW.
TW2 TW4
Day |N | km # gap % km # gap % km
1 354 2136.14 21 34.0 1707.42 13 28.3 1493.79 10
2 368 2194.42 20 34.6 1746.60 13 31.6 1499.51 11
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