Valid inequalities for Lagrangian relaxation in an inventory location problem with stochastic capacity

Author(s):  
Pablo A. Miranda ◽  
Rodrigo A. Garrido
2018 ◽  
Vol 2018 ◽  
pp. 1-27 ◽  
Author(s):  
Claudio Araya-Sassi ◽  
Pablo A. Miranda ◽  
Germán Paredes-Belmar

We studied a joint inventory location problem assuming a periodic review for inventory control. A single plant supplies a set of products to multiple warehouses and they serve a set of customers or retailers. The problem consists in determining which potential warehouses should be opened and which retailers should be served by the selected warehouses as well as their reorder points and order sizes while minimizing the total costs. The problem is a Mixed Integer Nonlinear Programming (MINLP) model, which is nonconvex in terms of stochastic capacity constraints and the objective function. We propose a solution approach based on a Lagrangian relaxation and the subgradient method. The decomposition approach considers the relaxation of different sets of constraints, including customer assignment, warehouse demand, and variance constraints. In addition, we develop a Lagrangian heuristic to determine a feasible solution at each iteration of the subgradient method. The proposed Lagrangian relaxation algorithm provides low duality gaps and near-optimal solutions with competitive computational times. It also shows significant impacts of the selected inventory control policy into total system costs and network configuration, when it is compared with different review period values.


2021 ◽  
Vol 289 (3) ◽  
pp. 975-986
Author(s):  
Massimo Di Francesco ◽  
Manlio Gaudioso ◽  
Enrico Gorgone ◽  
Ishwar Murthy

2018 ◽  
Vol 269 (3) ◽  
pp. 824-833 ◽  
Author(s):  
Laura Galli ◽  
Adam N. Letchford ◽  
Sebastian J. Miller

2003 ◽  
Vol 23 (1) ◽  
pp. 111-128 ◽  
Author(s):  
Jorge R. Vera ◽  
Andrés Weintraub ◽  
Manfred Koenig ◽  
Gaston Bravo ◽  
Monique Guignard ◽  
...  

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