First Friday Webinars – Optimization Approaches in e-commerce: Network Design & Marketplace Dispatching

Presented by Çağrı Doğuş Iyican (Trendyol Express) and Yahya Ertuğrul Geçkil (Trendyol Express)

Trendyol Express (TEX) is the sub-branch in Trendyol that leads daily cargo operations. As in other cargo cases, it needs depots for storing, sorting and transporting to meet customer demand and manage seller supplies. In this context, TEX has two kinds of depots for its operations which are sorting centers and cross-docks (x-docks). Sorting centers are responsible for taking packages from sellers and delivering these packages to x-docks whereas x-docks are responsible for delivering packages to customers. In a growing market, first mile and last mile demands in e-commerce forces planners to design an efficient network in order to optimize delivery times. This project aims to find the optimal locations for sorting centers and x-docks under several operational constraints.

Increasing e-commerce demand is hard to satisfy because of delivery bottlenecks. Cargo capacity growth ratio is far below e-commerce sales growth. Also, delivery costs have a major effect on expenses for e-commerce companies. Furthermore, delivery management is crucial for customer satisfaction levels. However, as well as customers, the number of sellers taking place in marketplaces is also increasing dramatically. Since it is not possible to find out best practice for tens of thousands of sellers manually, it is quite possible that resources are wasted, customers can not reach their orders in desired time and sellers deal with unnecessary costs. Besides, managers waste weeks only to find out a feasible plan. A mathematical model is developed for solving the dispatching problem for marketplace sales beside backlog amount. The model aims to distribute backlog and sales by minimizing the total delivery time.