Efficient formulations for dynamic warehouse location under discrete transportation costs

Brunaud, Braulio; Bassett, Matthew H.; Agarwal, Anshul; Wassick, John M.; Grossmann, Ignacio E.

doi:10.1016/j.compchemeng.2017.05.011

Cited by 17 publications

(11 citation statements)

References 31 publications

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“…Laínez et al 30 develop a flexible SCN design through a model that does not assume a limited number of echelons, allows for multisource supplies, and admits capacity expansions over a multiperiod planning horizon. Very recent works also account for discrete or piecewise linear functions to model transportation costs, 31,32 consider economies of scale governing operational and capital expenditures, 9 and assess the responsiveness of the SCN to fulfill demands. 12 In any case, despite the nonlinear nature of the economies of scale, mixed-integer linear approaches are typically adopted.…”

Section: Literature Reviewmentioning

confidence: 99%

Supply chain networks servicing upstream operations in oil and gas fields after the shale revolution

Montagna

Cafaro

2019

AIChE Journal

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The recent irruption of shale resources in the oil and gas (O&G) industry has dramatically changed the paradigm for managing upstream operations. Unconventional production is largely driven by drilling new wells, yielding a much larger scale of material and service flows that need to be efficiently planned. This article presents an optimization framework for the design of integrated supply chain networks (SCNs) servicing upstream operations. Novel aspects addressed in this work are the integrated planning of material and service supplies; the economies of scale in operating, transportation and capital expenditures; the concept of waiting cost to quantify production losses; and the reverse flow of materials within closed‐loop supply chains. The merits of the proposed approach are assessed through real‐world case studies from the Argentine O&G industry. Optimal designs yield significant cost savings and confirm that the integrated planning of the SCN is critical for O&G operators after the shale revolution.

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Section: Literature Reviewmentioning

confidence: 99%

Supply chain networks servicing upstream operations in oil and gas fields after the shale revolution

Montagna

Cafaro

2019

AIChE Journal

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“…Brunaud et al proposed a piecewise linear formulation to capture this effect. It is based on recognizing that the higher the throughput, the likelihood to be serving more customers increases, and thus the standard deviation is reduced.…”

Section: Safety Stock Modelingmentioning

confidence: 99%

“…Diabat and Theodorou proposed a general linearization for the model to formulate a mixed‐integer linear programming model (MILP). Recently, Brunaud et al proposed a piecewise‐linear formulation for the problem and showed that the approximation yields similar results to the MINLP formulation. You and Grossmann integrated the guaranteed service level concept proposed by in MINLP models.…”

Section: Introductionmentioning

confidence: 99%

Inventory policies and safety stock optimization for supply chain planning

Brunaud

Laínez-Aguirre²,

Pinto³

et al. 2018

AIChE Journal

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In this article, traditional supply chain planning models are extended to simultaneously optimize inventory policies. The inventory policies considered are the (r,Q) and (s,S) policies. In the (r,Q) inventory policy an order for Q units is placed every time the inventory level reaches level r, while in the s,S policy the inventory is reviewed in predefined intervals. If the inventory is found to be below level s, an order is placed to bring the level back to level S. Additionally, to address demand uncertainty four safety stock formulations are presented: (1) proportional to throughput, (2) proportional to throughput with risk-pooling effect, (3) explicit risk-pooling, and (4) guaranteed service time. The models proposed allow simultaneous optimization of safety stock, reserve, and base stock levels in tandem with material flows in supply chain planning. The formulations are evaluated using simulation.

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“…Demirel et al (2010) also used Choquet integral approach to determine warehouse location with criteria such as costs, labor characteristics, infrastructure, markets and macro environment for a leading Turkish logistics firm. Brunaud et al (2018) applied mixed integer linear programming model to determine the optimal number, location and capacity of the warehouses needed to support a long-term forecast with seasonal demand. Discrete transportation costs, dynamic warehouse contracting and the handling of safety stock were considered in the research.…”

Section: Location Determinationmentioning

confidence: 99%

An identification of warehouse location in Thailand

Vanichchinchai

Apirakkhit²

2018

APJML

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Purpose The purpose of this research is to identify a province in Thailand where total transportation cost for shipping grocery goods from this province to customers in all other provinces is the lowest. Design/methodology/approach Transportation distances among provinces, freight rate and the number of population in each province were gathered. Total transportation cost was computed by taking distance, tapering freight rate and population including that in original province into account. Findings Based on pre-set assumptions, it reveals that Saraburi province has the lowest total transportation cost. Research limitations/implications This research emphasizes only transportation cost. For future research, other monetary and non-monetary factors such as land, labor, investment incentive, local government regulation should be considered together. Practical implications This is an industry-based research especially for retail and fast-moving consumer goods businesses. Originality/value This practitioner paper is one of the first to identify population, freight rate and distance-based warehouse location which can be determined as a location for Thailand’s logistics hub, particularly for retail or fast-moving consumer goods business in Thailand.

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Efficient formulations for dynamic warehouse location under discrete transportation costs

Cited by 17 publications

References 31 publications

Supply chain networks servicing upstream operations in oil and gas fields after the shale revolution

Supply chain networks servicing upstream operations in oil and gas fields after the shale revolution

Inventory policies and safety stock optimization for supply chain planning

An identification of warehouse location in Thailand

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