Shortening the Last Mile in Urban Areas: Optimizing a Smart Logistics Concept for E-Grocery Operations

Abstract

Urbanization, the corresponding road traffic, and increasing e-grocery markets require efficient and at the same time eco-friendly transport solutions. In contrast to traditional food procurement at local grocery stores, e-grocery, i.e., online ordered goods, are transported directly to end customers. We develop and discuss an optimization approach to assist the planning of e-grocery deliveries in smart cities introducing a new last mile concept for the urban food supply chain. To supply city dwellers with their ordered products, a network of refrigerated grocery lockers is optimized to temporarily store the corresponding goods within urban areas. Customers either collect their orders by themselves or the products are delivered with electric cargo bicycles (ECBs). We propose a multi-echelon optimization model that minimizes the overall costs while consecutively determining optimal grocery locker locations, van routes from a depot to opened lockers, and ECB routes from lockers to customers. With our approach, we present an advanced concept for grocery deliveries in urban areas to shorten last mile distances, enhancing sustainable transportation by avoiding road traffic and emissions. Therefore, the concept is described as a smart transport system.