An integrated production and distribution planning model for perishable products

In this paper, a new formulation for integrating production planning and distribution planning of perishable products through lot sizing and inventory routing problem is presented. Some assumptions about the problem are as follows; there is a production facility which produces a single product, then delivers them directly using limited number of capacitated vehicles to geographically dispersed distribution centres. Also, the product is perishable, i.e., it is storable only for predetermined periods. Because of the computational complexity of the problem, using the exact methods is not feasible especially when the problem size is large. So, we have developed an efficient heuristic algorithm which is able to find good quality solutions in a reasonable time. Efficiency of the algorithm is proved through number of randomly generated test problems. The algorithm performance is compared to the LINGO commercial optimiser.