Variable neighborhood search for the inventory routing and scheduling problem in a supply chain

The inventory, routing and scheduling decisions are three major driving factors for supply chain performance. Since they are related to one another in a supply chain, they should be determined simultaneously to improve the decision quality. In the past, the inventory policy, vehicle routing and vehicle scheduling are determined sequentially and separately. Hence, the total cost (inventory, routing and vehicle costs) would increase. In this paper, an integrated model for the inventory routing and scheduling problem (IRSP) is proposed. Since searching for the optimal solution for this model is a non-polynomial (NP) problem, a metaheuristic, variable neighborhood search (VNS), is proposed. The proposed method was compared with other existing methods. The experimental results indicate that the proposed method is better than other methods in terms of average cost per day.     

A branch-and-price guided search approach to maritime inventory routing

We apply branch-and-price guided search to a real-world maritime inventory routing problem, in which the inventory of a single product, which is produced and consumed at multiple sites, and its transport, which is done with a heterogeneous fleet of vessels, is managed over a finite horizon. Computational experiments demonstrate that branch-and-price guided search quickly produces solutions that are near-optimal and of better quality than those produced by a state-of-the-art, commercial integer programming solver that is given much more time. We also develop local search schemes to further reduce the time needed to find high quality solutions and present computational evidence of their efficacy.     

A deterministic tabu search algorithm for the capacitated arc routing problem

The capacitated arc routing problem (CARP) is a difficult optimisation problem in vehicle routing with applications where a service must be provided by a set of vehicles on specified roads. A heuristic algorithm based on tabu search is proposed and tested on various sets of benchmark instances. The computational results show that the proposed algorithm produces high quality results within a reasonable computing time. Some new best solutions are reported for a set of test problems used in the literature.     

A tabu search heuristic for the truck and trailer routing problem

Two new construction heuristics and a tabu search heuristic are presented for the truck and trailer routing problem, a variant of the vehicle routing problem. Computational results indicate that the heuristics are competitive to the existing approaches. The tabu search algorithm obtained better solutions for each of 21 benchmark problems.     

A two phase variable neighborhood search for the multi-product inventory routing problem

We address a multi-product inventory routing problem and propose a two-phase Variable Neighborhood Search (VNS) metaheuristic to solve it. In the first phase, VNS is used to solve a capacitated vehicle routing problem at each period to find an initial solution without taking into account the inventory. In the second phase, we iteratively improve the initial solution while minimizing both the transportation and inventory costs. For this, we propose two different algorithms, a Variable Neighborhood Descent and a Variable Neighborhood Search. We present an heuristic and a Linear Programming formulation, which are applied after each local search move, to determine the amount of products to collect from each supplier at each period. During the exploration, we use priority rules for suppliers and vehicles, based on the current delivery schedule over the planning horizon. Computational results show the efficiency of the proposed two-phase approach.     

Iterated local search and simulated annealing algorithms for the inventory routing problem

This paper addresses the inventory routing problem (IRP), which consists in defining the customer visit schedule, the delivery quantities, and the vehicle routing plan to meet the demands of a set of customers over a given time horizon. We consider the variant with a single item, a single supplier, multiple vehicles, and a finite multiperiod planning horizon, minimizing the sum of inventory and travel costs. In addition, we address an alternative objective function that minimizes the logistic ratio, defined as the total travel cost divided by the total quantity delivered to customers. This second objective function, while more realistic in some logistics settings, poses a challenge for integer programming models and exact methods because of its nonlinearity. To our knowledge, no heuristic method has been proposed to address this objective in the IRP variant addressed in this paper. To solve this problem with each of these objective functions, we propose effective metaheuristic algorithms based on iterated local search and simulated annealing. Computational experiments show that these algorithms provide reasonably high‐quality solutions in relatively short running times for both objective functions when compared to other methods for well‐known instances from the literature. Moreover, the algorithms produce new best solutions for some of these instances.     

Considering lost sale in inventory routing problems for perishable goods

This paper presents a mathematical model for an inventory routing problem (IRP). The model is especially designed for allocating the stock of perishable goods. It is assumed that the age of the perishable inventory has a negative impact on the demand of end customers and a percentage of the demand is considered as lost sale. The proposed model balances the transportation cost, the cost of inventory holding and lost sale. In addition to the usual inventory routing constraints, we consider the cost of lost sale as a linear or an exponential function of the inventory age. The proposed model is solved to optimality for small instances and is used to obtain lower bounds for larger instances. We have also devised an efficient meta-heuristic algorithm to find good solutions for this class of problems based on Simulated Annealing (SA) and Tabu Search (TS). Computational results indicate that, for small problems, the average optimality gaps are less than 10.9% and 13.4% using linear and exponential lost sale functions, respectively. Furthermore, we show that the optimality gaps found by CPLEX grow exponentially with the problem size while those obtained by the proposed meta-heuristic algorithm increase linearly.     

A tabu search algorithm for the heterogeneous fixed fleet vehicle routing problem

In the heterogeneous fixed fleet vehicle routing problem there are different types of vehicles and a given number of vehicles of each type. The resolution of this problem consists of assigning the customers to the existing vehicles and, in relation to each vehicle, defining the order of visiting each customer for the delivery or collection of goods. The objective is to minimize the total costs, satisfying customers’ requirements and visiting each customer exactly once. In this paper a tabu search algorithm is proposed and tested on several benchmark problems. The computational experiments show that the proposed algorithm produces high quality solutions within an acceptable computation time. Four new best solutions are reported for a set of test problems used in the literature.     

A tabu search algorithm for the vehicle routing problem with simultaneous pick-up and delivery service

The vehicle routing problem with simultaneous pick-up and delivery (VRP_SPD) is a variant of the classical vehicle routing problem (VRP) where clients require simultaneous pick-up and delivery service. Deliveries are supplied from a single depot at the beginning of the vehicle's service, while pick-up loads are taken to the same depot at the conclusion of the service. One important characteristic of this problem is that a vehicle's load in any given route is a mix of pick-up and delivery loads.     

A hybrid variable neighborhood tabu search heuristic for the vehicle routing problem with multiple time windows

This paper presents a new hybrid variable neighborhood-tabu search heuristic for the Vehicle Routing Problem with Multiple Time windows. It also proposes a minimum backward time slack algorithm applicable to a multiple time windows environment. This algorithm records the minimum waiting time and the minimum delay during route generation and adjusts the arrival and departure times backward. The implementation of the proposed heuristic is compared to an ant colony heuristic on benchmark instances involving multiple time windows. Computational results on newly generated instances are provided.     

Heuristics for a multiperiod inventory routing problem with production decisions

Manufacturers who resupply a large number of retailers on a periodic basis continually struggle with the question of how to formulate a replenishment strategy. This paper presents a comparative analysis of a series of heuristics for an inventory routing problem (IRP) that arises in a manufacturing supply chain. The IRP is formulated as a mixed integer program with the objective of maximizing the net benefits associated with making deliveries in a specific time period to a widely dispersed set of customers. It is assumed that inventory can accumulate at the customer sites, but that all demand must be met without backlogging. Because optimal solutions were not within reach of exact methods, a two-step procedure was developed that first estimates daily delivery quantities and then solves a vehicle routing problem for each day of the planning horizon. As part of the methodology, a linear program is used to determine which days it is necessary to make at least some deliveries to avoid stockouts.The IRP is investigated in the context of an integrated production–inventory–distribution–routing problem (PIDRP). The full model takes into account production decisions and inventory flow balance in each period. For the computations, a previously developed branch-and-price algorithm is used that requires the solution of multiple IRPs (one in each period) to generate columns for the master problem. Testing showed that PIDRP instances with up to eight time periods and 50 customers can be solved within 1 h. This level of performance could not be matched by either CPLEX or an exact version of the branch-and-price algorithm.     

Extended guided tabu search and a new packing algorithm for the two-dimensional loading vehicle routing problem

In this paper, we develop an extended guided tabu search (EGTS) and a new heuristic packing algorithm for the two-dimensional loading vehicle routing problem (2L-CVRP). The 2L-CVRP is a combination of two well-known NP-hard problems, the capacitated vehicle routing problem, and the two-dimensional bin packing problem. It is very difficult to get a good performance solution in practice for these problems. We propose a meta-heuristic methodology EGTS which incorporates theories of tabu search and extended guided local search (EGLS). It has been proved that tabu search is a very good approach for the CVRP, and the guiding mechanism of the EGLS can help tabu search to escape effectively from local optimum. Furthermore, we have modified a collection of packing heuristics by adding a new packing heuristic to solve the loading constraints in 2L-CVRP, in order to improve the cost function significantly. The effectiveness of the proposed algorithm is tested, and proven by extensive computational experiments on benchmark instances.     

Adaptive granular local search heuristic for a dynamic vehicle routing problem

The advance of communication and information technologies based on satellite and wireless networks have allowed transportation companies to benefit from real-time information for dynamic vehicle routing with time windows. During daily operations, we consider the case in which customers can place requests such that their demand and location are stochastic variables. The time windows at customer locations can be violated although lateness costs are incurred. The objective is to define a set of vehicle routes which are dynamically updated to accommodate new customers in order to maximize the expected profit. This is the difference between the total revenue and the sum of lateness costs and costs associated with the total distance traveled. The solution approach makes use of a new constructive heuristic that scatters vehicles in the service area and an adaptive granular local search procedure. The strategies of letting a vehicle wait, positioning a vehicle in a region where customers are likely to appear, and diverting a vehicle away from its current destination are integrated within a granular local search heuristic. The performance of the proposed approach is assessed in test problems based on real-life Brazilian transportation companies.     

An effective heuristic for solving a combined cargo and inventory routing problem in tramp shipping

In this paper a vendor managed inventory (VMI) service in tramp shipping is considered. VMI takes advantage of introducing flexibility in delivery time and cargo quantities by transferring inventory management and ordering responsibilities to the vendor which in this case is a shipping company. A two-phase heuristic is proposed to determine routes and schedules for the shipping company. The heuristic first converts inventories into cargoes, thus turning the problem into a classic ship routing and scheduling problem. It then uses adaptive large neighborhood search to solve the resulting cargo routing and scheduling problem. The heuristic iteratively changes the cargoes generated to handle the customer’s inventories, based on the information obtained from an initial solution. Computational results are presented, discussed and compared with exact solutions on large realistic instances. The results reveal the potential savings from converting traditional contracts of affreightment to an integrated VMI service. The factors that influence the benefits obtainable through VMI are also analyzed.     

A tabu search procedure for coordinating production,inventory and distribution routing problems

This paper addresses the problem of optimally coordinating a production‐distribution system over a multi‐period finite horizon, where a facility production produces several items that are distributed to a set of customers by a fleet of homogeneous vehicles. The demand for each item at each customer is known over the horizon. The production planning determines how much to produce of each item in every period, while the distribution planning defines when customers should be visited, the amount of each item that should be delivered to customers and the vehicle routes. The objective is to minimize the sum of production and inventory costs at the facility, inventory costs at the customers and distribution costs. We also consider a related problem of inventory routing, where a supplier receives or produces known quantities of items in each period and has to solve the distribution problem. We propose a tabu search procedure for solving such problems, and this approach is compared with vendor managed policies proposed in the literature, in which the facility knows the inventory levels of the customers and determines the replenishment policies.     

An adaptive local search algorithm for vehicle routing problem with simultaneous and mixed pickups and deliveries

The Vehicle Routing Problem with Simultaneous Pickup and Delivery (VRPSPD) is an extension to the classical Vehicle Routing Problem (VRP), where customers may both receive and send goods simultaneously. The Vehicle Routing Problem with Mixed Pickup and Delivery (VRPMPD) differs from the VRPSPD in that the customers may have either pickup or delivery demand. However, the solution approaches proposed for the VRPSPD can be directly applied to the VRPMPD. In this study, an adaptive local search solution approach is developed for both the VRPSPD and the VRPMPD, which hybridizes a Simulated Annealing inspired algorithm with Variable Neighborhood Descent. The algorithm uses an adaptive threshold function that makes the algorithm self-tuning. The proposed approach is tested on well-known VRPSPD and VRPMPD benchmark instances derived from the literature. The computational results indicate that the proposed algorithm is effective in solving the problems in reasonable computation time.     

A multi-start evolutionary local search for the two-dimensional loading capacitated vehicle routing problem

This paper addresses an extension of the capacitated vehicle routing problem where customer demand is composed of two-dimensional weighted items (2L-CVRP). The objective consists in designing a set of trips minimizing the total transportation cost with a homogenous fleet of vehicles based on a depot node. Items in each vehicle trip must satisfy the two-dimensional orthogonal packing constraints. A GRASP×ELS algorithm is proposed to compute solutions of a simpler problem in which the loading constraints are transformed into resource constrained project scheduling problem (RCPSP) constraints. We denote this relaxed problem RCPSP-CVRP. The optimization framework deals with RCPSP-CVRP and lastly RCPSP-CVRP solutions are transformed into 2L-CVRP solutions by solving a dedicated packing problem. The effectiveness of our approach is demonstrated through computational experiments including both classical CVRP and 2L-CVRP instances. Numerical experiments show that the GRASP×ELS approach outperforms all previously published methods.     

Vehicle routing scheduling for cross-docking in the supply chain

One of the most important factors in implementing supply chain management is to efficiently control the physical flow of the supply chain. Due to its importance, many companies are trying to develop efficient methods to increase customer satisfaction and reduce costs. In various methods, cross-docking is considered a good method to reduce inventory and improve responsiveness to various customer demands. However, previous studies have dealt mostly with the conceptual advantages of cross-docking or actual issues from the strategic viewpoint. It is also necessary, however, to considering cross-docking from an operational viewpoint in order to find the optimal vehicle routing schedule. Thus, an integrated model considering both cross-docking and vehicle routing scheduling is treated in this study. Since this problem is known as NP-hard, a heuristic algorithm based on a tabu search algorithm is proposed. In the numerical example, our proposed algorithm found a good solution whose average percentage error was less than 5% within a reasonable amount of time.     

A variable neighborhood search simheuristic for the multiperiod inventory routing problem with stochastic demands

The inventory routing problem (IRP) combines inventory management and delivery route‐planning decisions. This work presents a simheuristic approach that integrates Monte Carlo simulation within a variable neighborhood search (VNS) framework to solve the multiperiod IRP with stochastic customer demands. In this realistic variant of the problem, our goal is to establish the optimal refill policies for each customer–period combination, that is, those individual refill policies that minimize the total expected cost over the periods. This cost is the aggregation of both expected inventory and routing costs. Our simheuristic algorithm allows to consider the inventory changes between periods generated by the realization of the random demands in each period, which have an impact on the quantities to be delivered in the next period and, therefore, on the associated routing plans. A range of computational experiments are carried out in order to illustrate the potential of our simulation–optimization approach.     

A construction and improvement heuristic for a liquefied natural gas inventory routing problem

We present a large scale ship routing and inventory management problem for a producer and distributor of liquefied natural gas (LNG). The problem contains multiple products, inventory and berth capacity at the loading port and a heterogeneous fleet of ships. The goal is to create an annual delivery program to fulfill the producer’s long-term contracts at minimum cost, while maximizing the revenue from selling LNG in the spot market. To solve this problem we have developed a construction and improvement heuristic (CIH).The CIH is a multi-start local search heuristic that constructs a set of solutions using a greedy insertion procedure. The solutions are then improved using either a first-descent neighborhood search, branch-and-bound on a mathematical formulation, or both. Tests on real-life instances show that the CIH provides good solutions in a short amount of time.