A cyclic allocation model for the inventory-modulated capacitated location problem. Issue 4 (2nd October 2017)

• Record Type: Journal Article
• Authors: Maass, Kayse Lee; Daskin, Mark S.
• Is Part Of: Infor. Volume 55:Issue 4(2017)
• Page Start: 312
• Page End: 338
• Publication Date: 2017-10-02
• Subjects: Location -- capacitated -- daily demands -- inventory -- backlog -- mixed-integer linear program; Operations research -- Periodicals; Electronic data processing -- Periodicals; Systems engineering -- Periodicals; Systems engineering; Electronic data processing; Periodicals; 003.05
• DOI: 10.1080/03155986.2017.1290425
• Languages: English
• ISSNs: 0315-5986

Abstract

ABSTRACT: Hard capacity constraints have been used for decades in facility location modelling and planning. However, such constraints are unrealistic as a variety of operational tools can be used to extend capacity in the short term. To address this, the Inventory-Modulated Capacitated Location Problem (IMCLP) uses inventory as a method of mitigating the hard capacity constraints, but enforces single sourcing. In this paper, we examine a cyclic, day-specific allocation approach to assigning demand sites to processing facilities in the IMCLP. This enables the model to develop a day-of-the-week allocation policy that considers day-to-day variations in the daily processing capacity levels of a set of candidate processing facilities and/or systematic day-to-day demand variations. We demonstrate that allowing demands at a particular site to be allocated to multiple processing facilities in such a manner can be a cost-effective operational tool.