Warehouse Location Under Continuous Economies of Scale

Abstract

Warehouse Location is a nonconvex programming problem involving the geographic placing and sizing of intermediate facilities in distribution studies. The nonconvexities are caused by economies of scale associated with the cost of building and operating the facilities. A heuristic program has been developed for solving warehouse location problems when these economies are representable by continuous concave functions. The paper discusses the heuristics used and computational experience with the program on "practical" problems. On the basis of two numerical examples for which an optimal solution was obtained through a special purpose experimental mixed integer programming code, it is conjectured (1) that near optimal solutions can be achieved using the heuristic program and (2) that optimal sizing and locating of facilities are very sensitive to the shapes of the warehousing cost functions.

Cost Optimisation in Freight Distribution with Cross-Docking: N-Echelon Location Routing Problem

“…The second one is composed by the Alternate Location Allocation [16] and the Savings algorithm [17]. The third one combines a Savings algorithm and the DROP method of Feldman et al [18] Wren [15], Brunswicker [19] and Vahrenkamp [20] propose several heuristics in order to solve a variant of this problem where the 1 st echelon routes can visit some customers. In their approach, each 211 th echelon route visits only a satellite.…”

The p-median problem: A survey of metaheuristic approaches

“…The Stingy heuristic (Feldman, et al, 1966), also known as Drop or Greedy-Drop, starts with all m facilities opened, and then removes them one by one until the number of facilities has been reduced to p; each time the location which least increases total cost is selected. A modified implementation of the stingy heuristic is to start from a subset instead of the entire set of potential sites (Salhi and Atkinson, 1995).…”

“…Different variants of this approach are suggested in Galvão Type Heuristic References CH Greedy Kuehn & Hamburger (1963), Whitaker (1983. Stingy Feldman et al (1966), Moreno-Pérez et al (1991). Dual ascent Galvão (1977Galvão ( , 1980 Cornuejols et al (1977), Mulvey & Crowder (1979), relaxation Galvão (1980), Beasley (1993), Daskin (1995), Senne & Lorena (2000), Barahona & Anbil (2000), Beltran et al (2004).…”

A TSSA algorithm based approach to enhance the performance of warehouse system

“…Van der berg and Zijm (1999) explained the various types of the warehousing systems, and discussed the various decision problems encountered in setting up warehousing systems, including justification, design, planning and control issues. The warehouse location problems under continuous economies of scale were studied by Feldman et al (1966). Warehousing efficiency is a key factor in the supply chain management to outperform the competitors on the basis of customer service, lead-times, and costs (Koster, 1998).…”