A hybrid simulated annealing based heuristic for solving the location-routing problem with fuzzy demands

The location-routing problem (LRP) is established as a new research area in the context of location analysis, which deals simultaneously with two problems of locating the facilities and designing the travel routes for vehicles among established facilities and existing demand points. In this paper, the location-routing problem with fuzzy demands (LRPFD) is considered which may arise in many real life situations in logistics management, and a fuzzy chance constrained program is designed to model it, based on the fuzzy credibility theory. A hybrid simulated annealing (SA) based heuristic incorporated with stochastic simulation is developed and proposed to solve the problem. The efficiency of the solution procedure is demonstrated via comparing its performance with those of some other existing solution procedures from literature using a standard benchmark set of test problems.