Inventory sharing strategy and optimization for reusable transport items

Reusable transport items (RTI), as a sustainable solution to the increasing packaging wastes generated along with the ever-growing globalized supply chains, create both challenges and opportunities to organizations for their management. A trend of organizations outsourcing their RTI activities explains the rapid emerging of a third-party RTI pooler. Yet few research studies have been conducted from the perspective of the RTI pooler for optimizing their customer allocation, and few on the decision support model for a practical case in the developing economies. This research intends to fill in this gap. Motivated by a case study of a leading RTI pooling company in China, this research proposes to implement a sharing strategy into the daily planning operation of distribution and routing. A decision support framework is developed to optimize the distribution flows and dispatching vehicle routes by the use of a two-stage solution process. Empirical results demonstrate an economic savings of 28.1% in the transportation costs along with environmental and social advantages implicated by the shortened travel distance of vehicles.