Capacity planning and warehouse location in supply chains with uncertain demands

E Aghezzaf ()
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E Aghezzaf: University of Ghent, Technologiepark

Journal of the Operational Research Society, 2005, vol. 56, issue 4, 453-462

Abstract: Abstract We discuss the strategic capacity planning and warehouse location problem in supply chains operating under uncertainty. In particular, we consider situations in which demand variability is the only source of uncertainty. We first propose a deterministic model for the problem when all relevant parameters are known with certainty, and discuss related tractability and computational issues. We then present a robust optimization model for the problem when the demand is uncertain, and demonstrate how robust solutions may be determined with an efficient decomposition algorithm using a special Lagrangian relaxation method in which the multipliers are constructed from dual variables of a linear program.

Keywords: capacity planning; warehouse location; distribution; robust optimization (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (29)

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DOI: 10.1057/palgrave.jors.2601834

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