COMBINED USE OF SIMULATION AND OPTIMIZATION MODELS AS A DECISION SUPPORT TOOL FOR ROBUST INVENTORY ROUTING PROBLEMS

1 HANCZAR Paweł
Co-authors:
2 KALETA Jacek 3 KARKULA Marek
Institutions:
1 Wrocław University of Economics, Department of Logistics, Poland, EU, pawel.hanczar@ue.wroc.pl
2 Cracow University of Technology, Department of Civil Engineering, Poland, EU, jacekkaleta@poczta.onet.pl
3 AGH University of Science and Technology, Department of Engineering Management, Cracow, Poland, EU, mkarkula@zarz.agh.edu.pl
Conference:
Carpathian Logistics Congress, Hotel Tatra, Zakopane, Poland, EU, November 28th - 30th 2016
Proceedings:
Proceedings Carpathian Logistics Congress
Pages:
105-111
ISBN:
978-80-87294-76-5
ISSN:
2694-9318
Published:
30th October 2017
Proceedings of the conference were published in Web of Science.
Metrics:
351 views / 121 downloads
Abstract

The combination of decisions regarding inventory management and vehicle routing decision leads to complex combinatorial optimization problem called the Inventory Routing Problem (IRP). Several heuristic algorithms for solving IRP were proposed in recent years. A lot of them are based on static and deterministic versions of IRP. Based on our management experience we identified a lot of situations where the VMI approach is used but the dynamic version of the IRP has to be considered. Such situations occur in case of LPG supplies to fuel stations. There are some proposals of heuristic policies which can be used in above mentioned circumstances. In our proposal after each delivery the optimization models are applied in order to optimize routes and delivery dates. In our paper we presented the combined use of optimization models and discrete event simulation to evaluate the influence of different variability of selected models’ parameters on the final plan. Simulation models have proved very useful as an aid to build dynamic and robust plans for considered inventory routing problem. We presented results of extensive simulation analysis of randomly generated cases for comparison our proposals and some policy solutions.

Keywords: VMI, VRP, IRP, DSS

© This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

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