Procurement of Global Logistics Services Using Combinatorial Auctions

Global logistics flows have increased dramatically in recent years due to the globalization in the world economy. It is more complex than the domestic logistics, consisting of multiple services like multi-modal transportation, cross-docking, storage, and customs clearance. Two issues are in order with multitude of services spanning across international borders: First, a single logistics provider may not be able to provide all the services and second, performance non-conformance with any of the services will affect the entire flow. We address the above issues in this paper by proposing a procurement that allows combinatorial bidding with quality of service measures as business constraints.