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An efficient heuristic approach for a multi-period logistics network redesign problem

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Abstract

In this paper, a multi-period logistics network redesign problem arising in the context of strategic supply chain planning is studied. Several aspects of practical relevance are captured, namely, multiple echelons with different types of facilities, product flows between facilities in the same echelon, direct shipments to customers, and facility relocation. A two-phase heuristic approach is proposed to obtain high-quality feasible solutions to the problem, which is initially modeled as a large-scale mixed-integer linear program. In the first phase of the heuristic, a linear programming rounding strategy is applied to find initial values for the binary location variables. The second phase of the heuristic uses local search to correct the initial variable choices when a feasible solution is not identified, or to improve the initial feasible solution when its quality does not meet given criteria. The results of a computational study are reported for randomly generated instances comprising a variety of logistics networks.

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Authors and Affiliations

  1. Business School, Saarland University of Applied Sciences, 66123, Saarbrücken, Germany

    M. T. Melo

  2. Fraunhofer Institute for Industrial Mathematics and Institute for Operations Research, Karlsruhe Institute of Technology, 76128, Karlsruhe, Germany

    S. Nickel

  3. Department of Statistics and Operations Research, and Operations Research Center, University of Lisbon, 1749-016, Lisbon, Portugal

    F. Saldanha-da-Gama

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  1. M. T. Melo
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  2. S. Nickel
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  3. F. Saldanha-da-Gama
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Correspondence to F. Saldanha-da-Gama.

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Melo, M.T., Nickel, S. & Saldanha-da-Gama, F. An efficient heuristic approach for a multi-period logistics network redesign problem. TOP 22, 80–108 (2014). https://doi.org/10.1007/s11750-011-0235-3

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