Particle swarm optimisation for multi stage supply chain network associated with fixed charges

This paper develops a particle swarm optimisation (PSO) algorithm for the multi stage supply chain network problem associated with the fixed charges. In many distribution problems, the transportation cost consists of fixed costs, that are independent of the quantities transported and variable costs, which are proportional to the quantities transported. The objective of this paper is to select the optimum set of suppliers, plants, distribution centres (DCs) to be opened and determine the quantities to be supplied to satisfy the customer demand with minimum total distribution cost. The problem chosen goes beyond the traditional mathematical programming and it becomes a non‐polynomial (NP) hard while considering the fixed costs. The performance of PSO is compared in terms of total distribution cost with spanning tree‐based genetic algorithm (st‐GA), improved Prüfer number encoding‐based genetic algorithm (IPEGA) and with LINGO. Computational results showed that the proposed PSO is capable of producing good quality solutions.