TITLE:
An Integrated Location-Routing-Inventory Problem by Considering Supply Disruption
AUTHORS:
Seyed Mohammad Seyedhosseini, Ali Bozorgi-Amiri, Sahar Daraei
KEYWORDS:
Facility Location, Location-Inventory, Routing, Transportation, SCM
JOURNAL NAME:
iBusiness,
Vol.6 No.2,
May
14,
2014
ABSTRACT:
In this paper, we
present a model of integrated Location Routing and Inventory problem (ILRIP)
with considering random disruption at distribution centers (DCs). The proposed
model simultaneously determines the number and the location of DCs that
should be opened, the assignment of customers to DCs, the allocation of
customers to active routes and the arrangement of customer sineach route,
reorder point and economic order quantity for each distribution center, and
finally, safety stock level should be kept per distribution center. In this
study, we consider a stochastic-demand inventory system where the product’s
supply is randomly disrupted in DCs. Distribution centers adopt a (r, Q) inventory
control policy. We assume that the distribution centers can be faced with a
shortage, in terms of disruption. Partial backordering is applied when a stock
out occurs. The model is formulated as a mixed-integer nonlinear programming,
which minimizes the expected total cost of the network. We solve the developed
mathematical model by meta-heuristic algorithm. Present computational results
for several randomly generated instances also for a case study according to
literature to show validation of the proposed model.