A cost optimization problem on a 2 level transportation network

In our model, a fleet of vehicles start from docking point to collect loads at the terminals assigned to the point. Then the docking points are connected to the hub by primary vehicle routes starting at the hub. This vehicle visits all the docking points to collect the loads which have been collected by the secondary vehicles. Our goal is to minimize the long-run cost of setting up the docking points and vehicle operation cost by deciding the location of the docking points and the routes optimally. We propose an heuristic algorithm to solve this and tested it through various experiments.