Ride service outsourcing for profit maximization

Transportation service subcontracting is becoming an effective means of business for many leading carriers to maintain their market dominance and profitability. This research is based on an outsourcing practice in one of the few largest limousine fleet companies in the US, whose (mostly advance) dem...

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Bibliographic Details
Published inTransportation research. Part E, Logistics and transportation review Vol. 45; no. 1; pp. 138 - 148
Main Authors Li, Yihua, Wang, Xiubin, Adams, Teresa M.
Format Journal Article
LanguageEnglish
Published Exeter Elsevier India Pvt Ltd 2009
Elsevier
Elsevier Sequoia S.A
SeriesTransportation Research Part E: Logistics and Transportation Review
Subjects
Column generation
Decision making models
Driver scheduling
Fleet assignment
Outsourcing
Profit maximization
Studies
Transportation service outsourcing
Transportation service outsourcing Fleet assignment Driver scheduling Column generation
Transportation services
United States > US
Transportation service outsourcing
Driver scheduling
Fleet assignment
Column generation
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Summary:Transportation service subcontracting is becoming an effective means of business for many leading carriers to maintain their market dominance and profitability. This research is based on an outsourcing practice in one of the few largest limousine fleet companies in the US, whose (mostly advance) demand for services often exceeds its capacity. We develop a model for ride service outsourcing. A column generation method is proposed. The outsourcing decision is made simultaneously with pre-scheduling of in-house ride services as well as staffing. Test with services data indicates that the developed method dramatically improves the carrier’s outsourcing decision.
ISSN:1366-5545
1878-5794
DOI:10.1016/j.tre.2008.02.006