Sombat Sindhuchao, H. Edwin Romeijn, Elif Akçalı, Rein Boondiskulchok
An integrated inventory-routing system for multi-item joint replenishment with limited vehicle capacity
In this paper, we develop a mathematical programming approach for
coordinating inventory and transportation decisions in an inbound
commodity collection system. In particular, we consider a system
that consists of a set of geographically dispersed suppliers that
manufacture one or more non-identical items, and a central
warehouse that stocks these items. The warehouse faces a constant
and deterministic demand for the items from outside retailers. The
items are collected by a fleet of vehicles that are dispatched
from the central warehouse. The vehicles are capacitated, and must
also satisfy a frequency constraint. Adopting a policy in which
each vehicle always collects the same set of items, we formulate
the inventory-routing problem of minimizing the long-run average
inventory and transportation costs as a set partitioning problem.
We employ a column generation approach to determine a lower bound
on the total costs, and develop a branch-and-price algorithm that
finds the optimal assignment of items to vehicles. We also propose
greedy constructive heuristics, and develop a very large-scale
neighborhood (VLSN) search algorithm to find near-optimal
solutions for the problem. Computational tests are performed on a
set of randomly generated problem instances.