On the optimal micro-hub locations in a multi-modal last-mile delivery system

Abstract

Last-mile delivery is one of the most polluting parts of the supply chain. In this work, we propose a multi-modal logistics system for last-mile delivery that combines the use of trucks, metro and micro-mobility. The envisioned system uses the metro to distribute the parcels to micro-hubs across the network and uses micro-mobility for the final part of the parcel’s itinerary. We focus on finding the optimal micro-hub locations in such a system. We use a continuum approximation of the operational decisions which includes routing of the micro-mobility vehicles. The whole problem is than modelled as a Mixed Integer Linear Programming model for the strategic and tactical decisions regarding the micro-hubs, which include location, capacity, and fleet-assignment decisions. We evaluate the results on a case study of the city of Madrid, which illustrates that a multi-modal last-mile delivery system can significantly improve a traditional last-mile delivery system both in terms of operational costs and pollution.