Int. J. of Industrial and Systems Engineering   »   2014 Vol.16, No.2

 

 

Title: Integrated location model with risk pooling and transportation mode selection

 

Authors: Abdulrahman R. Alenezi; Mohammed A. Darwish

 

Addresses:
Department of Industrial and Management Systems Engineering, College of Engineering and Petroleum, Kuwait University, P.O. Box 5969, 13060, Safat, Kuwait
Department of Industrial and Management Systems Engineering, College of Engineering and Petroleum, Kuwait University, P.O. Box 5969, 13060, Safat, Kuwait

 

Abstract: Location model with risk pooling and mode selection problems are integrated in this paper. Specifically, we consider a supply chain consisting of one supplier, distribution centres, transient points, and retailers who observe random demand that follows a certain probability distribution. Supplier dispatches the product to distribution centres using one mode of transportation while a given distribution centre may serve a retailer directly using one mode of transportation or through a transient point using two modes of transportation. The model is expected to determine facility location decisions, inventory decisions, and intermodal transportation decisions. The set of retailers who are assigned to a particular distribution centre are not known a priori. The derived model is large-scale and non-linear mixed integer programme. The difficulty of the model is reduced by adding a redundant constraint which made the solution procedure attainable. Also, Lagrangian relaxation approach is used to develop lower and upper limits on the optimal solution.

 

Keywords: supply chain management; SCM; location modelling; risk pooling; LMRP; transport mode selection; Lagrangian relaxation; transport modes; facility location; inventory decisions; intermodal transport; modelling.

 

DOI: 10.1504/IJISE.2014.058836

 

Int. J. of Industrial and Systems Engineering, 2014 Vol.16, No.2, pp.200 - 222

 

Available online: 21 Jan 2014

 

 

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