A Decomposition Approach to the Inventory Routing Problem with Satellite Facilities

Jonathan F. Bard, Liu Huang, Patrick Jaillet and Moshe Dror
Additional contact information
Jonathan F. Bard: Graduate Program in Operations Research, Department of Mechanical Engineering, The University of Texas at Austin, Austin, Texas 78712-1063
Liu Huang: DSC Communications, 11009 Metric Boulevard, Building 822, Austin, Texas 78758-4017
Patrick Jaillet: Department of Management Science and Information Systems, The University of Texas at Austin, Austin, Texas 78712
Moshe Dror: College of Business and Public Administration, University of Arizona, Tucson, Arizona 85721

Transportation Science, 1998, vol. 32, issue 2, 189-203

Abstract: This paper presents a comprehensive decomposition scheme for solving the inventory routing problem in which a central supplier must restock a subset of customers on an intermittent basis. In this setting, the customer demand is not known with certainty and routing decisions taken over the short run might conflict with the long-run goal of minimizing annual operating costs. A unique aspect of the short-run subproblem is the presence of satellite facilities where vehicles can be reloaded and customer deliveries continued until the closing time is reached. Three heuristics have been developed to solve the vehicle routing problem with satellite facilities (randomized Clarke-Wright, GRASP, modified sweep). After the daily tours are derived, a parametric analysis is conducted to investigate the tradeoff between distance and annual costs. This leads to the development of the efficient frontier from which the decision maker is free to choose the most attractive alternative. The proposed procedures are tested on data sets generated from field experience with a national liquid propane distributor.

Date: 1998
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

Downloads: (external link)
http://dx.doi.org/10.1287/trsc.32.2.189 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ortrsc:v:32:y:1998:i:2:p:189-203

Access Statistics for this article

More articles in Transportation Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().