Balancing store and warehouse fulfillment in e-groceries

Abstract

As e-grocery sales surge, optimizing fulfillment is crucial. Retailers face a trade-off between store- and warehouse-based fulfillment. Stores offer fast delivery due to their central locations, but have lower picking efficiency. Conversely, warehouses offer efficient picking but higher delivery costs as they are usually located outside the city center. This research analyzes this trade-off by integrating order assignment and vehicle routing decisions. A metaheuristic algorithm is proposed to identify the parameters influencing the balance between store and warehouse fulfillment.