Forward supply Chain network design problem: Heuristic approaches

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by: Cagri Koc, Eren Ozceylan, Saadettin Erhan Kesen, Zeynel Abidin Cil and Süleyman Mete


Determining positions and counting of actors, amount of product flow between and decreasing transportation costs are handled as a network design problem in supply chain management. Supply chain network design (SCND) problem belongs to the class of NP-hard problems. It has therefore appealed to a number of researchers’ close attention. However, existing literature lacks of common benchmark instances for forward SCND problems so as to make a fair comparison between developed and applied heuristic approaches. To this end, 450 new benchmark instances ranging from small to large size for forward SCND problems with two, three and four-echelon are generated and a mathematical model for each of the problems is formulated. Due to the complexity issues, we develop two heuristic solution approaches, genetic algorithm (GA) and hybrid heuristic algorithm (HHA), and we apply them to the large pool of benchmark instances. Comparative experiments show that both the GA and HHA can yield feasible solutions in much less computational time and, in particular, outperforms CPLEX regarding the solution quality as the number of echelon grows

Keywords:Supply chain network design, mixed integer programming; genetic algorithm; hybrid heuristic algorithm.

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