Abstract
The problem of allocating different types of vehicles for transporting a set of products from a manufacturer to its depots/cross docks, in an existing transportation network, to minimize the total transportation costs, is considered. The distribution network involves a heterogeneous fleet of vehicles, with a variable transportation cost and a fixed cost in which a discount mechanism is applied on the fixed part of the transportation costs. It is assumed that the number of available vehicles is limited for some types. A mathematical programming model in the form of the discrete nonlinear optimization model is proposed. A hybrid dynamic programming algorithm is developed for finding the optimal solution. To increase the computational efficiency of the solution algorithm, several concepts and routines, such as the imbedded state routine, surrogate constraint concept, and bounding schemes, are incorporated in the dynamic programming algorithm. A real world case problem is selected and solved by the proposed solution algorithm, and the optimal solution is obtained.
Highlights
Transportation is a critical part of global logistics systems, because of the long distances that can separate a firm from its customers
The third attempt is the approach of Morin and Esogbue [32] who proposed a dynamic programming algorithm which is searching over the imbedded state for obtaining an optimal solution
We developed an efficient solution approach by incorporating several routines in the dynamic programming (DP) solution algorithm
Summary
Transportation is a critical part of global logistics systems, because of the long distances that can separate a firm from its customers. The proposed transportation model is motivated by a vehicle-depots assignment in the transportation model of Solico Industrial Group (SIG) in a developing country with an existing distribution network. While considering this real world problem a more generalized version of this transportation model is explored. Our approach may later be adapted by the similar manufacturers in developing countries Based on these assumptions the problem is defined as a distribution system for delivering a set of products from a manufacturing firm to a set of distinct depots/cross docks and allocating the appropriate vehicles to the distribution branches to minimize the total transportation costs. The proposed solution approach is employed for solving a case problem and the result is reported
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