IDEAS home Printed from https://ideas.repec.org/a/eee/jomega/v41y2013i3p525-535.html
   My bibliography  Save this article

Commercial territory design planning with realignment and disjoint assignment requirements

Author

Listed:
  • Ríos-Mercado, Roger Z.
  • López-Pérez, J. Fabián

Abstract

A territory design problem motivated by a bottled beverage distribution company is addressed. The problem consists of finding a partition of the entire set of city blocks into a given number of territories subject to several planning criteria. Each unit has three measurable activities associated to it, namely, number of customers, product demand, and workload. The plan must satisfy planning criteria such as territory compactness, territory balancing with respect to each of the block activity measures, and territory connectivity, meaning that there must exist a path between any pair of units in a territory totally contained in it. In addition, there are some disjoint assignment requirements establishing that some specified units must be assigned to different territories, and a similarity with existing plan requirement. An optimal design is one that minimizes a measure of territory dispersion and similarity with existing design. A mixed-integer linear programming model is presented. This model is unique in the commercial territory design literature as it incorporates the disjoint assignment requirements and similarity with existing plan. Previous methods developed for related commercial districting problems are not applicable. A solution procedure based on an iterative cut generation strategy within a branch-and-bound framework is proposed. The procedure aims at solving large-scale instances by incorporating several algorithmic strategies that helped reduce the problem size. These strategies are evaluated and tested on some real-world instances of 5000 and 10,000 basic units. The empirical results show the effectiveness of the proposed method and strategies in finding near optimal solutions to these very large instances at a reasonably small computational effort.

Suggested Citation

  • Ríos-Mercado, Roger Z. & López-Pérez, J. Fabián, 2013. "Commercial territory design planning with realignment and disjoint assignment requirements," Omega, Elsevier, vol. 41(3), pages 525-535.
  • Handle: RePEc:eee:jomega:v:41:y:2013:i:3:p:525-535
    DOI: 10.1016/j.omega.2012.08.002
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0305048312001090
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. María Salazar-Aguilar & Roger Ríos-Mercado & Mauricio Cabrera-Ríos, 2011. "New Models for Commercial Territory Design," Networks and Spatial Economics, Springer, vol. 11(3), pages 487-507, September.
    2. Andreas Drexl & Knut Haase, 1999. "Fast Approximation Methods for Sales Force Deployment," Management Science, INFORMS, vol. 45(10), pages 1307-1323, October.
    3. Ronen, David, 1983. "Sales territory alignment for sparse accounts," Omega, Elsevier, vol. 11(5), pages 501-505.
    4. Andris A. Zoltners & Prabhakant Sinha, 1983. "Sales Territory Alignment: A Review and Model," Management Science, INFORMS, vol. 29(11), pages 1237-1256, November.
    Full references (including those not matched with items on IDEAS)

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jomega:v:41:y:2013:i:3:p:525-535. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/375/description#description .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.