An Adaptive Large Neighborhood Search Heuristic for Last-Mile Deliveries Under Stochastic Customer Availability and Multiple Visits

Attended Home Delivery, where customer attendance at home is required, is an essential last-mile delivery challenge, e.g., for valuable, perishable, or oversized items. Logistics service providers are often faced no-show customers. In this paper, we consider the delivery problem in which customers can be revisited on the same day by a courier in the case of a failed first delivery attempt. Specifically, customer presence uncertainty is considered in a two-stage stochastic program, where penalties are introduced as recourse actions for failed deliveries. We build on the notion of a customer availability profile defined as a profile containing historical time-varying probability information of successful deliveries. We tackle this stochastic program by developing an efficient parallelized Adaptive Large Neighborhood Search algorithm. Our results show that by achieving a right balance between increasing the hit rate and reducing travel cost, logistics service providers can realize costs savings as high as 32% if they plan for second visits on the same day.