Incorporating location and inventory decisions into a supply chain design problem with uncertain demands and lead times. (April 2017)

• Record Type: Journal Article
• Authors: Diabat, Ali; Dehghani, Ehsan; Jabbarzadeh, Armin
• Is Part Of: Journal of manufacturing systems. Volume 43:Part 1(2017)
• Page Start: 139
• Page End: 149
• Publication Date: 2017-04
• Subjects: Supply chain network design -- Facility location -- Inventory -- Uncertainty -- Queuing theory; Manufacturing processes -- Periodicals; Production engineering -- Data processing -- Periodicals; Robots, Industrial -- Periodicals; Production, Technique de la -- Informatique -- Périodiques; Robots industriels -- Périodiques; Electronic journals; 670.42
• DOI: 10.1016/j.jmsy.2017.02.010
• Languages: English
• ISSNs: 0278-6125

Abstract

Highlights: We present a joint location-inventory model for the network design. The uncertain natures of demands and replenishment lead times are incorporated into the model utilizing a queuing approach. A hybrid solution algorithm based on simulated annealing and direct search method is adopted. Abstract: This paper presents a joint location-inventory model for the network design of a supply chain with multiple Distribution Centers (DCs) and retailers. The developed model determines the number and location of DCs, the assignment of retailers to DCs, and the size and timing of orders for each DC. The uncertain natures of demands and replenishment lead times are incorporated into the model utilizing a queuing approach. To solve the presented model for large size problems, a hybrid solution algorithm based on simulated annealing and direct search method is adopted. The comparative analysis of the numerical results provides important modelling insights. Particularly, we demonstrate numerically that the cost savings obtained from the queuing approach can be significant.