Solutions for sustainable last-mile delivery: Pick-up points location with customers’ choice

Abstract

The ever-growing increase of e-commerce is motivating the development of innovative solutions for optimized and sustainable last-mile logistics in the business-to-consumer (B2C) parcel delivery market. Self-collection is a recent but consolidated delivery strategy in the field, allowing customers to autonomously collect parcels from assisted or unassisted dedicated facilities (pick-up points and parcel lockers). However, the success of self-collection depends on the location of such facilities, as this strongly affects customers’ propensity to patronize them. In this context, this paper proposes a mathematical programming model for the optimal location of pick-up points in urban areas. The model seeks to maximize the proportion of customers opting for self-collection to promote this strategy over home delivery. It uses a MultiNomial Logit (MNL) to model customers’ choices. Specifically, in the MNL, parameters reflecting customers’ behaviors are included to represent their preferences for the two strategies. The model is applied to the case of Bologna (northern Italy), and various scenarios are produced by varying parameters. The results demonstrate the relevance of customers’ behavior in affecting decisions and provide numerous managerial insights, thus classifying the proposed model as an effective support tool for the design of self-collection networks.