Integrated inventory-distribution planning in a (1:N) supply chain system with heterogeneous vehicles incorporated

Kim, Eun-Seok and Lee, Ik Sun (2011) Integrated inventory-distribution planning in a (1:N) supply chain system with heterogeneous vehicles incorporated. International Journal of Management Science, 17 (2). pp. 1-21. ISSN 1226-0797

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Abstract

This paper considers an integrated inventory-distribution system with a fleet of heterogeneous vehicles employed where a single warehouse distributes a single type of products to many spatially distributed retailers to satisfy their dynamic demands. The problem is to determine order planning at the warehouse, and also vehicle schedules and delivery quantities for the retailers with the objective of minimizing the sum of ordering cost at the warehouse, inventory holding cost at both the warehouse and retailers, and transportation cost. For the problem, we give a Mixed Integer Programming formulation and develop a Lagrangean heuristic procedure for computing lower and upper bounds on the optimal solution value. The Lagrangean dual problem of finding the best Lagrangrean lower bound is solved by subgradient optimization. Computational experiments on randomly generated test problems showed that the suggested algorithm gives relatively good solutions in a reasonable amount of computation time.

Item Type: Article
Research Areas: A. > Business School > International Management and Innovation
Item ID: 9993
Depositing User: Eun-Seok Kim
Date Deposited: 01 Mar 2013 05:32
Last Modified: 12 Sep 2017 14:02
URI: https://eprints.mdx.ac.uk/id/eprint/9993

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