Multi-depot vehicle routing problem: a one-stage approach

This paper introduces multi-depot vehicle routing problem with fixed distribution of vehicles (MDVRPFD) which is one important and useful variant of the traditional multi-depot vehicle routing problem (MDVRP) in the supply chain management and transportation studies. After modeling the MDVRPFD as a binary programming problem, we propose two solution methodologies: two-stage and one-stage approaches. The two-stage approach decomposes the MDVRPFD into two independent subproblems, assignment and routing, and solves them separately. In contrast, the one-stage approach integrates the assignment with the routing where there are two kinds of routing methods-draft routing and detail routing. Experimental results show that our new one-stage algorithm outperforms the published methods. Note to Practitioners-This work is based on several consultancy work that we have done for transportation companies in Hong Kong. The multi-depot vehicle routing problem (MDVRP) is one of the core optimization problems in transportation, logistics, and supply chain management, which minimizes the total travel distance (the major factor of total transportation cost) among a number of given depots. However, in real practice, the MDVRP is not reliable because of the assumption that there have unlimited number of vehicles available in each depot. In this paper, we propose a new useful variant of the MDVRP, namely multi-depot vehicle routing problem with fixed distribution of vehicles (MDVRPFD), to model the practicable cases in applications. Two-stage and one-stage solution algorithms are also proposed. The industry participators can apply our new one-stage algorithm to solve the MDVRPFD directly and efficiently. Moreover, our one-stage solution framework allows users to smoothly add new specified constraints or variants.