Efficient last-mile logistics with service options: A multi-criteria decision-making and optimization methodology

The rapid growth of online shopping has intensified the need for cost-effective and efficient delivery systems, posing a significant challenge for businesses worldwide. This study proposes an innovative two-phase methodology that uses a hybrid multi-criteria decision-making (MCDM) approach for efficient last-mile logistics with service options (ELMLSO) such as home delivery, self-pickup, and differently-priced services. This approach aims to streamline last-mile logistics by integrating these service options, resulting in a more comprehensive and effective delivery network that enhances customer satisfaction and maintains a competitive edge. The first phase employs the Ordinal Preference Analysis - Evaluation based on Distance from Average Solution (OPA-EDAS) method to select optimal pickup and delivery centers. The second phase identifies the optimal route using a bi-objective mixed-integer mathematical model, striving to balance cost minimization and customer satisfaction maximization. The Normalized Normal Constraint Method (NNCM) is utilized to solve this model. The application of these methods results in considerable cost savings and improved customer satisfaction, offering valuable insights for managers within the last-mile logistics industry.