Article ID: | iaor2007182 |
Country: | Netherlands |
Volume: | 169 |
Issue: | 3 |
Start Page Number: | 1048 |
End Page Number: | 1063 |
Publication Date: | Mar 2006 |
Journal: | European Journal of Operational Research |
Authors: | Aghezzaf El-Houssaine, Raa Birger, Landeghem Hendrik Van |
Keywords: | inventory, heuristics |
Given a distribution center and a set of sales-points with their demand rates, the objective of the inventory routing problem (IRP) is to determine a distribution plan that minimizes fleet operating and average total distribution and inventory holding costs without causing a stock-out at any of the sales-points during a given planning horizon. We propose a new model for the long-term IRP when demand rates are stable and economic order quantity-like policies are used to manage inventories of the sales-points. The proposed model extends the concept of vehicle routes (tours) to vehicle multi-tours. To solve the nonlinear mixed integer formulation of this problem, a column generation based approximation method is suggested. The resulting sub-problems are solved using a savings-based approximation method. The approach is tested on randomly generated problems with different settings of some critical factors to compare our model using multi-tours as basic constructs to the model using simple tours as basic constructs.