A hybrid heuristic algorithm for the multistage supply chain network problem

Abstract

In recent years, many developments in logistics were connected to the need for information in an efficient supply chain flow. The supply chain is often represented as a network called a supply chain network (SCN) that is comprised of nodes that represent facilities (suppliers, plants, distribution centers and customers). Arcs connect these nodes along with the production flow. A multistage SCN (MSCN) is a sequence of multiple SCN stages. The flow can only be transferred between two consecutive stages. The MSCN problem involves the choice of facilities (plants and distribution centers) to be opened and the distribution network design must satisfy the demand with minimum cost. In this paper, a revised mathematical model is first proposed to correct the fatal error appearing in the existing models. An efficient hybrid heuristic algorithm (HHA) was developed by combining a greedy method (GM), the linear programming technique (LP) and three local search methods (LSMs) (always used in solving the scheduling problem). The pair-wise exchange procedure (XP), the insert procedure (IP) and the remove procedure (RP) to solve the MSCN problem. Preliminary computational experiments demonstrate the efficiency and performance of the proposed HHA.