  This study focuses on order dispatch decisions within two-echelon supply
chains, where order dispatch creates economic shipments to reduce delivery
costs. Dispatching orders is often constrained by delivery windows, leading to
penalty costs for untimely deliveries. Prolonged dispatch times can increase
the lead time of orders and potentially violate these delivery windows. To
balance the trade-offs between lead time and economic delivery, this study
introduces a simulation-optimization approach for determining optimal ordering
and dispatch rules. It emphasizes the intricacies of the order dispatch process
and explores how these can be integrated into the simulation-optimization
procedure to improve ordering and delivery decisions. The study evaluates
various options for implementing dispatch rules, including the number of
dispatch queues and prioritized dispatch. The results indicate that a
single-queue, quantity-based, first-in-first-out dispatch approach achieves the
greatest cost reduction while maintaining a desirable service level.
