Collaborative truckload transportation procurement with multiple coalitions

We study formation of stable coalitions given a set of shippers and their lanes corresponding to regularly scheduled truckload shipment. In this thesis, selecting participants, deciding who should participate with whom, calculating the lowest cost operational solution and allocating the system-wide cost to the participants stand out as important problems. Collaborating shippers try to identify tours which consist of regularly scheduled shipment with minimal empty truck movements. Then, they must allocate the total cost of the collaborative solution to the participated firms and individual lanes such that the collaborative solution remains attractive to the participants. In the literature, solving the optimization problem minimization the total cost and allocating the calculated minimum cost are treated as successive but distinct phases. The cost minimizing optimization problem is solved with well-known operation research methods, while cooperative game theory concepts are used for cost allocation. The minimum cost solution may render finding an acceptable cost allocation impossible. Besides, similar works in the literature assume that the collaborating firms will forge a single grand coalition. However, as the collaboration grows in size, a single grand coalition may become impractical and also it might leave several lanes out of the coalition, depriving shippers of significant cost savings. In this study, we propose algorithm to design coalition structure which consist of multiple disjoint stable coalitions. Each coalition must have a minimum cost collaborative solution with an acceptable cost allocation. Due to the complexity of the task hand, we devised a heuristic to find good quality solutions to this problem.