Optimisation of a multilevel logistics network for prepositioned warehouses under an omni-channel retail model

A new omni-channel retailing mode—prepositioned warehouses—rapidly developed in China during COVID-19, is introduced together with a three-level logistics network optimisation model for agricultural products. The study captures omni-channel characteristics that combine vehicle delivery and consumer in-store purchase, incorporates a freshness penalty incurred during storage of fresh agricultural products, and builds a mathematical optimisation model for the three-stage logistics network based on the classical EOQ inventory model. The optimisation objectives are the shortest delivery time and the smallest total cost; the multi-objective problem is transformed into a single objective via normalisation and linear weighting, yielding a mixed-integer optimisation model. The paper addresses site selection for prepositioned warehouses, merchandise replenishment strategies, and optimisation of delivery routes using real-case data, and derives managerial insights through sensitivity analysis.

Chenxing Li, Xianliang Shi