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Designing Production-Inventory-Transportation Systems with Capacitated Cross-Docks

Author

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  • Hossein Abouee-Mehrizi

    (Department of Management Sciences, University of Waterloo, Waterloo, ON, N2L 3G1, Canada)

  • Oded Berman

    (Joseph L. Rotman School of Management, University of Toronto, Toronto, M5S 3E6, Canada)

  • M. Reza Baharnemati

    (Department of Industrial Engineering, University of Houston, Houston, Texas 77204)

Abstract

We consider a two-echelon supply chain problem, where the demand of a set of retailers is satisfied from a set of suppliers and shipped through a set of capacitated cross-docks that are to be established. The objective is to determine the number and location of cross-docks and the assignment of retailers to suppliers via cross-docking so that the total cost of pipeline and retailers inventory, transportation, and facility location is minimized. We formulate the problem as a nonlinear mixed integer programming. We first derive several structural results for special cases of the problem. We also demonstrate that the Capacitated Plant Fixed-Charge Transport Location Problem is a special case of our problem. To solve the general problem, we show that it can be written as a cutting stock problem and develop a column generation algorithm to solve it. We investigate the efficiency of the proposed algorithm numerically. We then extend the problem by allowing different truck capacities as decision variables.

Suggested Citation

  • Hossein Abouee-Mehrizi & Oded Berman & M. Reza Baharnemati, 2014. "Designing Production-Inventory-Transportation Systems with Capacitated Cross-Docks," Transportation Science, INFORMS, vol. 48(1), pages 121-135, February.
    • Handle: RePEc:inm:ortrsc:v:48:y:2014:i:1:p:121-135
    DOI: 10.1287/trsc.1120.0454
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    References listed on IDEAS

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    Cited by:

    1. İlker Küçükoğlu & Nursel Öztürk, 2017. "Two-stage optimisation method for material flow and allocation management in cross-docking networks," International Journal of Production Research, Taylor & Francis Journals, vol. 55(2), pages 410-429, January.
    2. Lai, Minghui & Cai, Xiaoqiang & Li, Xiang, 2017. "Mechanism design for collaborative production-distribution planning with shipment consolidation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 106(C), pages 137-159.
    3. Amir Ardestani-Jaafari & Erick Delage, 2018. "The Value of Flexibility in Robust Location–Transportation Problems," Transportation Science, INFORMS, vol. 52(1), pages 189-209, January.
    4. Feifeng Zheng & Yaxin Pang & Yinfeng Xu, 2022. "Heuristics for cross-docking scheduling of truck arrivals, truck departures and shop-floor operations," Journal of Combinatorial Optimization, Springer, vol. 43(5), pages 1571-1601, July.

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