Verification of dynamic pricing for the purpose of suppressing fluctuations in cargo volume

Abstract

We have focused on the consolidated transportation, which is particularly difficult to control cargo volume, among truck transportation. Consolidation transportation has problems with vehicle arrangements and profitability. In this paper, we study a method to control the fluctuation of cargo volume by determining the transportation unit price from the expected cargo volume. We show that dynamic pricing changes the behavior of shippers, reducing fluctuations in cargo volume by simulation. We also show that it may increase profits of the logistics companies without increasing shipping costs paid by shippers under the conditions of our simulation.