Single-allocation ordered median hub location problems

Abstract

The discrete ordered median location model is a powerful tool in modeling classic and alternative location problems that have been applied with success to a large variety of discrete location problems. Nevertheless, although hub location models have been analyzed from the sum, maximum and coverage point of views, as far as we know, they have never been considered under an alternative unifying point of view. In this paper we consider new formulations, based on the ordered median objective function, for hub location problems with new distribution patterns induced by the different users’ roles within the supply chain network. This approach introduces some penalty factors associated with the position of an allocation cost with respect to the sorted sequence of these costs. First we present basic formulations for this problem, and then develop stronger formulations by exploiting properties of the model. The performance of all these formulations is compared by means of a computational analysis.