The leader multipurpose shopping location problem

Armin Lüer-Villagra, Vladimir Marianov, H.A. Eiselt and Gonzalo Méndez-Vogel

European Journal of Operational Research, 2022, vol. 302, issue 2, 470-481

Abstract: This paper extends the follower's retail store location problem of Marianov et al. (2018) to include the leader's decisions. The leader locates its stores knowing that a follower will enter the market later offering a different product. Both maximize their markets given that customers can purchase none, one or two non-essential products on the same trip. The paper determines the best locations for a first and a second entrants through exact and approximated procedures. It turns out that, by locating with foresight, a first entrant can increase the total business in an area for himself and subsequent entrants. We solve the binary programming bi-level resulting problem for small instances by adapting an ad-hoc procedure. Furthermore, a new bi-level reactive GRASP procedure finds solutions for instances of up to 100 nodes in under 3,600 s of CPU time.

Keywords: Location; Leader's problem; Multipurpose shopping; Consumer choice (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:302:y:2022:i:2:p:470-481

DOI: 10.1016/j.ejor.2022.01.016

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