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Trans. Planning Journal
| Title | A Slot Allocation Model with Overbooking for Liner Shipping |
|---|---|
| Author | Vincent C. Li and Yen-Ching Tsan |
| Summary | The liner shipping industry often suffers from no-shows and cancelations that make some container slots empty for a voyage. Container slots are perishable assets and can not be stored for the next voyage. A liner shipping company can enhance the slot utilization and reduce unused capacity by properly adopting the overbooking strategy, an important element of revenue management. On the other hand, due to the unbalanced container flow caused by the international trade pattern, a liner shipping company has to reposition the containers efficiently and effectively to satisfy the container need while trimming the reposition cost. In this paper, we discuss slot allocation on a single route by considering slot overbooking. By assuming a discrete customer show-up rate at each port, we propose a systematic approach to determine the amount to sell and the way to reposition empty containers so as to maximize the profit of the liner shipping company. We use a numerical example to show that the proposed overbooking model can increase the expected profit of the company. Moreover, the influence of adopting overbooking becomes more pronounced when the uncertainty of the customer show-up rate increases. |
| Vol. | 39 |
| No. | 3 |
| Page | 277 |
| Year | 2010 |
| Month | 9 |
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