Inventory-Transportation Integrated Optimization Problem in Many-to-Many Distribution Network

Abstract

In order to solve the Inventory-transportation Integrated Optimization problem (ITIO problem) in a distribution network consisting of many warehouses and many retailers, the Lagrange multiplier method, the scenario-based Dynamic Slope Scaling Procedure (DSSP) heuristics and the Lagrangian relaxation-based DSSP heuristics were applied to integrate the system of inventory control and transportation scheduling respectively and in proper sequence. The more efficient Lagrangian relaxation-based DSSP heuristics is found in solving the ITIO problem. And furthermore, the comparative experiments prove the heuristics can get the optimized results in less calculating time and the efficiency of this method is also proved in solving the ITIO problem in a many-to-many distribution network.