Tactical planning in cooperative two-tier city logistics systems with fairness constraints

Two-tier city logistics systems (2T-CLSs) offer the potential for more efficient and environmentally friendly freight management. Since such systems require substantial infrastructure and multiple Logistics Service Providers (LSPs) operate within a city, cooperation among LSPs presents opportunities for cost and emissions reductions. However, cooperation requires ensuring every LSP has an incentive to participate and feels fairly treated. To address this, we present a service network design formulation for multi-day tactical planning in a 2T-CLS with cooperating LSPs, incorporating fairness constraints on workload, costs, and service regularity. Through a numerical study, we quantify the impact of fairness constraints, showing that overly strict constraints harm the coalition. Lower cost increases and greater environmental benefits occur when fairness is enforced over multiple days rather than daily. Further, we observe a 47% reduction in CO 2 emissions through cooperation, providing valuable policy implications for LSPs and municipal authorities pursuing sustainable city logistics. • Service network design for multi-day cooperative two-tier city logistics. • Fairness constraints regarding workload and cost of logistics service providers. • Constraints regarding regularity of services over multiple days. • Numerical study on fairness and environmental aspects in multi-day planning. • Policy implications for cooperative city logistics systems.