Abstract
This paper presents a robust optimisation model for facility location decisions in supply chain design. Robust optimisation belongs to a prominent domain for dealing with optimisation problems with data uncertainty. In this study, a robust optimisation model for a three echelon supply chain is developed. First, a deterministic mixed integer linear formulation for the supply chain design problem is described. Then, the uncertainties in the coefficients of the objective function, left and right hand side parameters are considered and a robust mixed integer linear model is developed. Finally, the deterministic model and its robust counterpart are compared in a numerical experiment.
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