A solution method for a two-dispatch delivery problem with stochastic customers

A solution method for a two-dispatch delivery problem with stochastic customers

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Article ID: iaor20081791
Country: United Kingdom
Volume: 6
Issue: 1
Start Page Number: 87
End Page Number: 107
Publication Date: Mar 2007
Journal: Journal of Mathematical Modelling and Algorithms
Authors: , ,
Keywords: heuristics, programming: probabilistic
Abstract:

We study a vehicle routing problem in which vehicles are dispatched multiple times a day for product delivery. In this problem, some customer orders are known in advance while others are uncertain but are progressively realized during the day. The key decisions include determining which known orders should be delivered in the first dispatch and which should be delivered in a later dispatch, and finding the routes and schedules for customer orders. This problem is formulated as a two-stage stochastic programming problem with the objective of minimizing the expected total cost. A worst-case analysis is performed to evaluate the potential benefit of the stochastic approach against a deterministic approach. Furthermore, a sample-based heuristic is proposed. Computational experiments are conducted to assess the effectiveness of the model and the heuristic.

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