Horizontal cooperation in road transportation: a case illustrating savings in distances and greenhouse gas emissions

This paper discusses horizontal cooperation in road transportation and supports the relevance of this praxis as a way of reducing delivery costs and greenhouse gas emissions. In a competitive market, costs reduction due to economies of scale in short and long run constitutes a key issue for small and medium enterprises. The paper reviews the existing literature on the topic and then examines different scenarios in order to quantify the savings in route costs that can be attained throughout horizontal cooperation. This numerical analysis is based on a set of well-known benchmarks for the Multidepot Vehicle Routing Problem, which has been adapted to illustrate a realistic but seldom considered example of horizontal cooperation. An Iterated Local Search algorithm is proposed to obtain high-quality solutions for this collaborative scenario, while noncollaborative scenarios are solved using a well-tested algorithm for the Capacitated Vehicle Routing Problem. The savings in routing costsboth regarding distance-based and environmental costsare computed taking into account different geographical distributions of customers with respect to their assigned service providers.