The Vehicle Routing Problem: The Case of the Hong Kong Postal Service

<title>A<sc>bstract</sc> </title> With the growth in population and development of business activities in Hong Kong, the range and level of services provided by Hongkong Post have multiplied. However, the schedule of its postal vehicles, including mail collection and delivery, is still constructed manually on a daily basis, based on the experience of staff and transportation reviews. In this paper, the problem of scheduling a set of <italic>n</italic> collection points (District Post Offices) from a depot (General Post Office) in Hong Kong Island is addressed. The objectives pursued are the maximization of resource utilization and minimization of operation costs. In other words, the variable cost is expected to be reduced. To achieve these goals, an integer linear programming (IP) model of the vehicle routing problem (VRP) is developed in an effort to obtain optimal solutions. As the model involves computational complexity, a commercial software package <italic>CPLEX</italic> is used to solve the problems efficiently. The results show that the proposed model can produce optimal vehicle routes and schedules.