A heuristic approach to the design of fortified distribution
                    networks

A heuristic approach to the design of fortified distribution networks

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Article ID: iaor20131294
Volume: 50
Issue: 5-6
Start Page Number: 138
End Page Number: 148
Publication Date: Feb 2013
Journal: Transportation Research Part E
Authors: ,
Keywords: location, heuristics, supply & supply chains
Abstract:

Lean distribution networks have been increasingly exposed to the risk of unpredicted disruptions causing significant economic forfeitures. At the same time, the existing literature features a limited number of studies which consider fortification of facilities for improving network reliability. In this paper, we develop a reliable uncapacitated fixed‐charge location model with fortification to support the design of distribution networks. The model considers heterogeneous facility failure probabilities, one layer of supplier backup, and facility fortification within a finite budget. The problem is formulated as a nonlinear mixed integer programming model which is proved to be NP equ1‐hard. We develop a Lagrangian relaxation‐based (LR) heuristic solution algorithm and demonstrate its computational efficiency for solving large‐scale problems.

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