A Combinatorial Optimization Model for Customer Routing Problem Considering Cost Discount

Cost discount is a widely adopted strategy of logistics suppliers to increase order quantity. To improve the process of logistics routing decision in E-commerce, this paper studies a customer routing problem considering cost discount. Firstly, the 0-1 programming model is used to find the route to minimize the operating cost, considering the constraints of the due date by customers, transportation capacity and cost discount. Secondly, this optimization model is linearized and solved by CPLEX. Finally, numerical experiment is conducted to verify the validity of the model, which indicates that appropriate due date promised to customers, scale of order and proper cost discount will significantly save the transportation costs.