Embedding the production policy in location-allocation decisions
Emilio Carrizosa,
Alba V. Olivares-Nadal () and
Pepa Ramírez-Cobo
Additional contact information
Emilio Carrizosa: Institute of Mathematics of the University of Seville (IMUS)
Alba V. Olivares-Nadal: University of Chicago
Pepa Ramírez-Cobo: University of Cádiz
4OR, 2020, vol. 18, issue 3, No 4, 357-380
Abstract:
Abstract This paper investigates how the production policy, as well as other factors, affect the facility location-allocation decisions. We focus on a p-median location problem in which one single perishable product is to be produced and shipped to a set of users. The time-correlated demands of the clients are generated by autoregressive processes, and they are forecasted from historical data. Empirically, we show that: (i) embedding the production policy in the location-allocation decision problem may lead to a facilities-clients assignment which does not necessarily correspond to the minimum cost allocation, but produces better profits, (ii) taking into account the autocorrelation of the demand can significantly improve the performance of the supply chain, and (iii) the variability of the demand strongly affects the performance of the supply chain, so a careful choice of production strategy is especially recommended in this case.
Keywords: Facility layout; Allocation; Robust newsvendor; Autoregressive processes; Forecasting; 90B80; 90C10; 90B30 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
http://link.springer.com/10.1007/s10288-019-00423-z Abstract (text/html)
Access to the full text of the articles in this series is restricted.
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:spr:aqjoor:v:18:y:2020:i:3:d:10.1007_s10288-019-00423-z
Ordering information: This journal article can be ordered from
https://www.springer ... ch/journal/10288/PSE
DOI: 10.1007/s10288-019-00423-z
Access Statistics for this article
4OR is currently edited by Yves Crama, Michel Grabisch and Silvano Martello
More articles in 4OR from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().