Exploring the Impact of Overbooking Strategies in Barge Container Transport: A simulation study

Abstract

Barge container transport faces significant capacity management challenges due to no-show uncertainty and arrival time deviations, leading to underutilized capacity on barges. This research investigates the application of overbooking strategies in barge transportation to address these challenges and provides decision support for managing uncertainty in barge operations. A discrete-event simulation model was developed using Arena software to evaluate different acceptance strategies, allocation methods, and overbooking rates under varying no-show conditions. The study reveals that overbooking effectiveness is highly dependent on the allocation strategies effectiveness and the no-show rates. With poor allocation strategies the penalties incurred from overbooking increases significantly. At lower no-show rates, overbooking provides limited benefits with disproportionately high trucking increase, while at higher rates, overbooking restores capacity utilization while incurring less trucking. The trade-off analysis establishes a framework to find opportunity cost thresholds for accepting additional orders, enabling operators to evaluate economic viability based on their competitive position. This research extends overbooking theory from traditional service industries to barge transportation and provides a framework for capacity management in barge container transport with overbooking, offering practical decision support tools for terminal operators to improve profits.