 The maximum capture per unit cost location problemGuowei Hua, T.C.E. Cheng and Shouyang Wang International Journal of Production Economics, 2011, vol. 131, issue 2, 568-574 Abstract: This paper considers the problem of siting p new facilities of an entering firm to a competitive market so as to maximize the market share captured from competitors per unit cost. We first formulate the problem as a mixed 0-1 fractional programming model, in which we incorporate the fixed cost and transportation cost. The model can deal with the case where some demand nodes have two or more possible closest servers. We then re-formulate the problem as a 0-1 mixed integer linear program. We use a one-opt heuristic algorithm based on the Teitz-Bart method to obtain feasible solutions and compare them with the optimal solutions obtained by a branch-and-bound algorithm. We conduct computational experiments to evaluate the two algorithms. The results show that both algorithms can solve the model efficiently and the model is integer-friendly. We discuss other computational results and provide managerial insights. Keywords: Competitive; location; Maximum; capture; Mixed; integer; fractional; programming; Branch-and-bound (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:131:y:2011:i:2:p:568-574 Access Statistics for this article International Journal of Production Economics is currently edited by Stefan Minner More articles in International Journal of Production Economics from Elsevier |
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