Integrated mobile inventory and fleet management for an on-demand delivery system

Abstract

This study introduces an optimization framework for deploying Mobile Fleet Inventories (MFIs) to address operational inefficiencies in on-demand delivery systems. Traditionally, these systems rely on stationary facilities to organize operations and manage resources. While stationary facilities provide stability and structured coverage, they are inherently rigid and struggle to adapt to the spatial and temporal fluctuations characteristic of urban service demand. By leveraging urban waterways, MFIs act as dynamic, mobile facilities, enabling real-time resource redistribution and offering greater flexibility to meet evolving demand patterns efficiently. We formulate the problem as a mixed-integer linear programming model to optimize MFI deployment, minimizing total system costs. The model incorporates both capital investments (e.g., MFI leasing and docking infrastructure) and operational expenses (e.g., rider idle time). Key decisions include determining the optimal number, placement of MFIs, and fleet size. To validate the approach, we apply it to a meal delivery platform in Amsterdam, demonstrating its practicality and scalability. Results show that implementing MFIs reduces overall system costs by 17% and decreases rider idle time by 35% compared to stationary facility operations. These findings underscore the transformative potential of MFIs to enhance the efficiency, sustainability, and adaptability of on-demand delivery systems in urban settings.