H. Edwin Romeijn, Dolores Romero Morales
A greedy heuristic for a three-level
multi-period single-sourcing problem
In this paper we consider a model for integrating transportation
and inventory decisions in a three-level logistics network
consisting of plants, warehouses, and retailers (or customers).
Our model includes production and throughput capacity constraints,
and minimizes production, holding, and transportation costs in a
dynamic environment. We show that the problem can be reformulated
as a certain type of assignment problem with convex objective
function. Based on this observation, we propose a greedy heuristic
for the problem, and illustrate its behaviour on a class of
randomly generated problem instances. These experiments suggest
that the heuristic may be asymptotically feasible and optimal with
probability one in the number of customers.