Constrained optimisation of distribution network using new hybrid PSO optimiser

The efficient and effective movement of goods from raw material sites to processing facilities, component fabrication plants, finished goods assembly plants, distribution centres, retailers and customers are critical in today's competitive environment. These in turn depend on facility location decisions taken during strategic planning. These facilities are expensive to construct and difficult to modify. Inefficient locations for production and assembly plants as well as distribution centres will result in excess costs being incurred throughout the lifetime of the facilities, no matter how well the production plans, transportation options, inventory management, and information sharing decisions are optimised in response to changing conditions. This paper addresses design of network model for facility location and capacity allocation where in a set of customer locations with demands and a set of candidate facility locations will be known in advance. If a facility is located at a candidate site, a known fixed location cost is incurred. There is a known unit shipment cost between each candidate site and each customer location. The problem is to find the locations of the facilities and the shipment pattern between the facilities and the customers to minimise the combined facility location and shipment costs subject to a requirement that all customer demands be met. To optimise this, the distribution network model is mathematically represented and solved using hybrid PSO algorithm.