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Logistics capacity planning: A stochastic bin packing formulation and a progressive hedging meta-heuristic

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  • Crainic, Teodor Gabriel
  • Gobbato, Luca
  • Perboli, Guido
  • Rei, Walter

Abstract

We consider the logistics capacity planning problem arising in the context of supply-chain management. We address the tactical-planning problem of determining the quantity of capacity units, hereafter called bins, of different types to secure for the next period of activity, given the uncertainty on future needs in terms of demand for loads (items) to be moved or stored, and the availability and costs of capacity for these movements or storage activities. We propose a modeling framework introducing a new class of bin packing problems, the Stochastic Variable Cost and Size Bin Packing Problem. The resulting two-stage stochastic formulation with recourse assigns to the first stage the tactical capacity-planning decisions of selecting bins, while the second stage models the subsequent adjustments to the plan, securing extra bins and packing the items into the selected bins, performed each time the plan is applied and new information becomes known. We propose a new meta-heuristic based on progressive hedging ideas that includes advanced strategies to accelerate the search and efficiently address the symmetry strongly present in the problem considered due to the presence of several equivalent bins of each type. Extensive computational results for a large set of instances support the claim of validity for the model, efficiency for the solution method proposed, and quality and robustness for the solutions obtained. The method is also used to explore the impact on the capacity plan and the recourse to spot-market capacity of a quite wide range of variations in the uncertain parameters and the economic environment of the firm.

Suggested Citation

  • Crainic, Teodor Gabriel & Gobbato, Luca & Perboli, Guido & Rei, Walter, 2016. "Logistics capacity planning: A stochastic bin packing formulation and a progressive hedging meta-heuristic," European Journal of Operational Research, Elsevier, vol. 253(2), pages 404-417.
  • Handle: RePEc:eee:ejores:v:253:y:2016:i:2:p:404-417
    DOI: 10.1016/j.ejor.2016.02.040
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    Citations

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    Cited by:

    1. Ren, Shuyun & Choi, Tsan-Ming & Lee, Ka-Man & Lin, Lei, 2020. "Intelligent service capacity allocation for cross-border-E-commerce related third-party-forwarding logistics operations: A deep learning approach," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 134(C).
    2. Crainic, Teodor Gabriel & Perboli, Guido & Rei, Walter & Rosano, Mariangela & Lerma, Veronica, 2024. "Capacity planning with uncertainty on contract fulfillment," European Journal of Operational Research, Elsevier, vol. 314(1), pages 152-175.
    3. Lanza, Giacomo & Crainic, Teodor Gabriel & Rei, Walter & Ricciardi, Nicoletta, 2021. "Scheduled service network design with quality targets and stochastic travel times," European Journal of Operational Research, Elsevier, vol. 288(1), pages 30-46.
    4. Kabli, Mohannad & Quddus, Md Abdul & Nurre, Sarah G. & Marufuzzaman, Mohammad & Usher, John M., 2020. "A stochastic programming approach for electric vehicle charging station expansion plans," International Journal of Production Economics, Elsevier, vol. 220(C).
    5. Menglei Ji & Mohammad Mosaffa & Amir Ardestani-Jaafari & Jinlin Li & Chun Peng, 2024. "Integration of text-mining and telemedicine appointment optimization," Annals of Operations Research, Springer, vol. 341(1), pages 621-645, October.
    6. Ramon Faganello Fachini & Vinícius Amaral Armentano & Franklina Maria Bragion Toledo, 2022. "A Granular Local Search Matheuristic for a Heterogeneous Fleet Vehicle Routing Problem with Stochastic Travel Times," Networks and Spatial Economics, Springer, vol. 22(1), pages 33-64, March.
    7. Wagenaar, J.C. & Fragkos, I. & Faro, W.L.C., 2023. "Transportation asset acquisition under a newsvendor model with cutting-stock restrictions: Approximation and decomposition algorithms," Other publications TiSEM 97eddbd0-6e34-489c-b27d-9, Tilburg University, School of Economics and Management.
    8. Schepler, Xavier & Rossi, André & Gurevsky, Evgeny & Dolgui, Alexandre, 2022. "Solving robust bin-packing problems with a branch-and-price approach," European Journal of Operational Research, Elsevier, vol. 297(3), pages 831-843.
    9. Tseremoglou, Iordanis & Bombelli, Alessandro & Santos, Bruno F., 2022. "A combined forecasting and packing model for air cargo loading: A risk-averse framework," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 158(C).
    10. Manerba, Daniele & Mansini, Renata & Perboli, Guido, 2018. "The Capacitated Supplier Selection problem with Total Quantity Discount policy and Activation Costs under uncertainty," International Journal of Production Economics, Elsevier, vol. 198(C), pages 119-132.
    11. Baldi, Mauro Maria & Manerba, Daniele & Perboli, Guido & Tadei, Roberto, 2019. "A Generalized Bin Packing Problem for parcel delivery in last-mile logistics," European Journal of Operational Research, Elsevier, vol. 274(3), pages 990-999.
    12. Perboli, Guido & Brotcorne, Luce & Bruni, Maria Elena & Rosano, Mariangela, 2021. "A new model for Last-Mile Delivery and Satellite Depots management: The impact of the on-demand economy," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 145(C).
    13. Shanshan Wang & Jinlin Li & Sanjay Mehrotra, 2021. "Chance-Constrained Multiple Bin Packing Problem with an Application to Operating Room Planning," INFORMS Journal on Computing, INFORMS, vol. 33(4), pages 1661-1677, October.
    14. Jiu, Song & Wang, Dan & Ma, Zujun, 2024. "Benders decomposition for robust distribution network design and operations in online retailing," European Journal of Operational Research, Elsevier, vol. 315(3), pages 1069-1082.
    15. Vitor W. B. Martins & Rosley Anholon & Osvaldo L. G. Quelhas & Walter Leal Filho, 2019. "Sustainable Practices in Logistics Systems: An Overview of Companies in Brazil," Sustainability, MDPI, vol. 11(15), pages 1-12, July.
    16. Cannella, Salvatore & Dominguez, Roberto & Ponte, Borja & Framinan, Jose M., 2018. "Capacity restrictions and supply chain performance: Modelling and analysing load-dependent lead times," International Journal of Production Economics, Elsevier, vol. 204(C), pages 264-277.

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