Integration of production and distribution decisions of perishable products considering feasible delivery routes

Abstract

In any supply chain, production and distribution decisions are of great importance. In this paper, instead of considering those decisions separately, we focus on integrating them. To do this, a new integrated production-distribution planning model for perishable products is formulated. The proposed model considers situation in which there is a single production facility with a single product, which distributes the products using limited number of capacitated vehicles to geographically dispersed distribution centres through set of pre-defined feasible delivery routes. As shown in the paper, computational complexity of the proposed model makes it hard to solve by exact methods. So, an efficient heuristic algorithm is developed to provide good quality solution. In the proposed algorithm, the integrated model is first divided into two sub models, then a solution for each sub model is found using LINGO, and finally solution for the integrated model is combined. Efficiency of the algorithm is proved through number of randomly generated test problems and by comparing the results to the LINGO.