Capacitated facility location problem with freight cost discount

Author

Gao, Dapeng ; Jiao, Wen ; Zhang, Juliang

Author_Institution

Dept. of Logistics Manage., Beijing Jiaotong Univ., Beijing, China

fYear

2010

fDate

28-30 June 2010

Firstpage

1

Lastpage

5

Abstract

In reality, unit shipment cost is a decreasing function in shipment volume because of economics of scale. In this paper, we extend the capacitated facility location problem (CFLP) considering discounted freight cost. We formulate this problem as a mixed integer linear problem (MILP), and minimize the total cost including setup costs for opening the facilities and transportation costs with freight cost discount. Based on the special structure of the MILP, a Benders decomposition algorithm is proposed to solve it.

Keywords

cost reduction; facility location; freight handling; integer programming; linear programming; Benders decomposition algorithm; CFLP; MILP; capacitated facility location problem; freight cost discount; mixed integer linear problem; unit shipment cost; Communication networks; Cost function; Hospitals; Linear programming; Logistics; NP-hard problem; Production facilities; Shipbuilding industry; Transportation; Benders decomposition method; facility location problem; freight cost discount;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2010 7th International Conference on

Conference_Location

Tokyo

Print_ISBN

978-1-4244-6485-2

Type

conf

DOI

10.1109/ICSSSM.2010.5530233

Filename

5530233