Principal Components of Milk Run systems
Suppose that vehicle pick-up or delivery routings occur with some regularity and are not randomly distributed. This is, for instance, the case for suppliers of large companies, which are integrated into a synchronized sourcing/delivery scheme with regular JIT/JIS cycles to minimize inventory holding for the production process. It is also the case for suppliers of retail or supermarket chains, which usually have to deliver small or medium-sized loads on a regular schedule. In such cases the roundtrips can be organized in form of Milk Runs, that is on a fixed schedule using optimal regional tours and adjusted vehicle sizes/equipment.
Milk-Run is in particular considered in the following cases: •
When there is demand at multiple pick-up/delivery points for services which frequently repeat or are integrated in JIT/JIS cycles. • When a company/service provider runs a vehicle fleet and is able to adjust the vehicle sizes/equipment to the individual demand. • When a company/service provider has the facilities for optimal planning and organization of tours, in particular the necessary ITS technologies and associated know-how.2
The planning of Milk Run logistics includes the following steps: •
Establishment of the nodal points of distribution for a milk-run tour. • Determination of important requirements for the type of service (necessary quantities, delivery times, sequence of delivery, quality requirements, e.g. for perishable goods or sensitive spare parts). • Construction of feasible tours, which fulfil all requirements. • Improvement of tours, usually applying optimization algorithms and heuristics.
Milk Run logistics utilizes one vehicle to conduct several pick-ups/deliveries in roundtrips, so that the pick-up/delivery points should be located within a limited area which a one-day trip could cover, at least. Although this area need not necessarily be urban, Milk Run seems highly beneficial in congested urban environments. Furthermore, it can be linked to the long-distance interurban logistics, by rail for example, in the national and world-wide network of big companies. If transhipments cannot be avoided at the interfaces between interurban and urban freight transport, as for instance at UCC or logistic villages, then cross-docking technologies can be applied to minimize time losses and adjust vehicle sizes for the last-mile tours. Usually there are three types of cross-docking applied: •
Pre-allocated cross-docking (units are carried without any change, e.g. packed in pallets, from the sender to the recipient). Only vehicle change occurs at cross-docking points, e.g. from large to small trucks. • Break-Bulk cross docking (consignments are processed and regrouped into new units at the transhipment point). Such processes usually are carried out in large logistics centres. • Break-Bulk plus Value Added Services (sorting, packing, last assembly steps).
Fig. 2 summarizes the discussion above, showing three applications of consolidation system involving Milk Run among others: ‘Pick-up Milk Run’, ‘Delivery Milk Run’ and ‘Milk and Main Runs’. In the application of ‘Milk and Main Runs’, Milk Run can be organized not only before the cross-docking process at the transhipment facility, but also after the long-distance logistics and another cross docking process.
Principal Components of Milk Run systemsSuppose that vehicle pick-up or delivery routings occur with some regularity and are not randomly distributed. This is, for instance, the case for suppliers of large companies, which are integrated into a synchronized sourcing/delivery scheme with regular JIT/JIS cycles to minimize inventory holding for the production process. It is also the case for suppliers of retail or supermarket chains, which usually have to deliver small or medium-sized loads on a regular schedule. In such cases the roundtrips can be organized in form of Milk Runs, that is on a fixed schedule using optimal regional tours and adjusted vehicle sizes/equipment.Milk-Run is in particular considered in the following cases: •When there is demand at multiple pick-up/delivery points for services which frequently repeat or are integrated in JIT/JIS cycles. • When a company/service provider runs a vehicle fleet and is able to adjust the vehicle sizes/equipment to the individual demand. • When a company/service provider has the facilities for optimal planning and organization of tours, in particular the necessary ITS technologies and associated know-how.2The planning of Milk Run logistics includes the following steps: •Establishment of the nodal points of distribution for a milk-run tour. • Determination of important requirements for the type of service (necessary quantities, delivery times, sequence of delivery, quality requirements, e.g. for perishable goods or sensitive spare parts). • Construction of feasible tours, which fulfil all requirements. • Improvement of tours, usually applying optimization algorithms and heuristics.Milk Run logistics utilizes one vehicle to conduct several pick-ups/deliveries in roundtrips, so that the pick-up/delivery points should be located within a limited area which a one-day trip could cover, at least. Although this area need not necessarily be urban, Milk Run seems highly beneficial in congested urban environments. Furthermore, it can be linked to the long-distance interurban logistics, by rail for example, in the national and world-wide network of big companies. If transhipments cannot be avoided at the interfaces between interurban and urban freight transport, as for instance at UCC or logistic villages, then cross-docking technologies can be applied to minimize time losses and adjust vehicle sizes for the last-mile tours. Usually there are three types of cross-docking applied: •Pre-allocated cross-docking (units are carried without any change, e.g. packed in pallets, from the sender to the recipient). Only vehicle change occurs at cross-docking points, e.g. from large to small trucks. • Break-Bulk cross docking (consignments are processed and regrouped into new units at the transhipment point). Such processes usually are carried out in large logistics centres. • Break-Bulk plus Value Added Services (sorting, packing, last assembly steps).Fig. 2 summarizes the discussion above, showing three applications of consolidation system involving Milk Run among others: ‘Pick-up Milk Run’, ‘Delivery Milk Run’ and ‘Milk and Main Runs’. In the application of ‘Milk and Main Runs’, Milk Run can be organized not only before the cross-docking process at the transhipment facility, but also after the long-distance logistics and another cross docking process.
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