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A congested facility location problem with strategic customers

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  • Jalili Marand, Ata
  • Hoseinpour, Pooya

Abstract

This study addresses a user-equilibrium congested facility location problem with delay-, accessibility-, and price-sensitive customers. A profit-maximizing service provider first makes location, service rate, and pricing decisions, and then strategic customers decide which facilities to patronize (if any). By incorporating the customers’ choice behavior as a set of equilibrium constraints into the service provider’s decision problem, the problem is modeled as a mixed integer non-linear program which is then reformulated as a mixed integer second-order cone program. The proposed model, tested on several standard instances, is shown to be efficiently solvable using commercial software packages.

Suggested Citation

  • Jalili Marand, Ata & Hoseinpour, Pooya, 2024. "A congested facility location problem with strategic customers," European Journal of Operational Research, Elsevier, vol. 318(2), pages 442-456.
    • Handle: RePEc:eee:ejores:v:318:y:2024:i:2:p:442-456
    DOI: 10.1016/j.ejor.2024.05.026
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    References listed on IDEAS

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