An Algorithm for Air Cargo Forwarders Consolidation Problem

Cargo consolidation operation significantly affected the profit of air cargo forwarders. The problem of cargo consolidation is an NP-hard. In order to solve realistically large-scale cargo consolidation problems, this paper transformed the air cargo forwarders consolidation problem to well-known set covering problem based on mixed integer programming model and used Lagrangian Relaxation to develop a recursive heuristic algorithm, and discussed the problems of feasible solution determination and set adjustment. A numerical experiment was tested. The results show that the algorithm is feasible with high computing efficiency, and generates solutions very close to optimal solution.