An optimization model for the transportation network with hierarchical structure: the case of China Post

We study the vehicle routing problem of China Post Group with time windows (VRP_CPG_TW). A three-level hub model is established, which includes the determination of the number, location of hubs and their service area as well as routes between hubs and local post office. We propose a comprehensive approach by integrating the center distribution method, and the Taboo and Genetic algorithm to solve the VRP_CPG_TW. The proposed algorithm is divided into two phase. The first phase includes initial site selection and regional division and the second phase is responsible for solving vehicle routing problem with time constraint. The two phases are iterated alternately until the feasible solution comes out. Our scheme is compared with the real scheme of Guizhou Post and about 25% operation fee is reduced. The test results confirm that our model has high potential to be applied to optimize the transportation network of China Post. Moreover, the proposed model also provides an effective solution for optimizing the transportation network with hierarchical structure.