Optimizing the periodic pick-up of raw materials for a manufacturer of auto parts

We describe a solution procedure for a special case of the periodic vehicle routing problem (PVRP). Operation managers at an auto parts manufacturer in the north of Spain described the optimization problem to the authors. The manufacturer must pick up parts (raw material) from geographically dispersed locations. The parts are picked up periodically at scheduled times. The problem consists of assigning a pickup schedule to each of its supplier's locations and also establishing daily routes in order to minimize total transportation costs. The time horizon under consideration may be as long as 90 days. The resulting PVRP is such that the critical decision is the assignment of locations to schedules, because once this is done, the daily routing of vehicles is relatively straightforward.