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A primal-dual algorithm for the economic lot-sizing problem with multi-mode replenishment

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  • Eksioglu, Sandra Duni

Abstract

The classical economic lot-sizing problem assumes that a single supplier and a single transportation mode are used to replenish the inventory. This paper studies an extension of this problem where several suppliers and transportation modes are available. The decision-making process in this case involves identifying (i) the timing for an order; (ii) the choice of shipment modes; and (iii) the order size for each mode. The problem is defined as a network flow problem with multiple setups cost function and additional side constraints. This study provides an MIP formulation for the problem. We also provide an additional formulation of the problem by redefining its decision variables and show that the dual of the corresponding LP-relaxation has a special structure. We take advantage of the structure of the dual problem to develop a primal-dual algorithm that generates tight lower and upper bounds. Computational results demonstrate the effectiveness of the algorithm.

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  • Eksioglu, Sandra Duni, 2009. "A primal-dual algorithm for the economic lot-sizing problem with multi-mode replenishment," European Journal of Operational Research, Elsevier, vol. 197(1), pages 93-101, August.
    • Handle: RePEc:eee:ejores:v:197:y:2009:i:1:p:93-101
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    References listed on IDEAS

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    1. Palak, Gökçe & Ekşioğlu, Sandra Duni & Geunes, Joseph, 2014. "Analyzing the impacts of carbon regulatory mechanisms on supplier and mode selection decisions: An application to a biofuel supply chain," International Journal of Production Economics, Elsevier, vol. 154(C), pages 198-216.

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