arXiv:2611.14174v1 Announce Type: new
Abstract: We introduce the cross-border (XB) fulfillment center (FC) Selection Model: a multi-stage optimization framework combining forecasting, doubly robust estimation, and linear programming to select optimal source FCs. For each source-destination shipping arc, the objective is to choose a subset of source-country FCs that minimize delivery time and cost while maximizing profit and shipped units under a fixed domestic network. We evaluate the model on three production-scale international shipping corridors for a large e-commerce company using 12 months of shipment data, employing both aggregate offline replay and shipment-level counterfactual nearest-neighbor matching. Across all shipping corridors, the XB FC Selection Model achieves 8.5-51.1% reductions in delivery time and 4.4-48.3% reductions in logistics cost relative to human expert-defined FC selection policies, with up to 6.5 percentage-point improvements in 5/5 target compliance (5 days, $5 USD). Pareto analysis shows the model consistently dominates single-objective ranking strategies and unconstrained LP on the efficiency-reallocation frontier, with all results statistically significant.
Abstract: We introduce the cross-border (XB) fulfillment center (FC) Selection Model: a multi-stage optimization framework combining forecasting, doubly robust estimation, and linear programming to select optimal source FCs. For each source-destination shipping arc, the objective is to choose a subset of source-country FCs that minimize delivery time and cost while maximizing profit and shipped units under a fixed domestic network. We evaluate the model on three production-scale international shipping corridors for a large e-commerce company using 12 months of shipment data, employing both aggregate offline replay and shipment-level counterfactual nearest-neighbor matching. Across all shipping corridors, the XB FC Selection Model achieves 8.5-51.1% reductions in delivery time and 4.4-48.3% reductions in logistics cost relative to human expert-defined FC selection policies, with up to 6.5 percentage-point improvements in 5/5 target compliance (5 days, $5 USD). Pareto analysis shows the model consistently dominates single-objective ranking strategies and unconstrained LP on the efficiency-reallocation frontier, with all results statistically significant.
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Cross-Border Fulfillment Center Selection via Doubly Robust Estimation and Linear Programming