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A heuristic approach to the design of fortified distribution networks

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  • Li, Qingwei
  • Savachkin, Alex

Abstract

Lean distribution networks have been increasingly exposed to the risk of unpredicted disruptions causing significant economic forfeitures. At the same time, the existing literature features a limited number of studies which consider fortification of facilities for improving network reliability. In this paper, we develop a reliable uncapacitated fixed-charge location model with fortification to support the design of distribution networks. The model considers heterogeneous facility failure probabilities, one layer of supplier backup, and facility fortification within a finite budget. The problem is formulated as a nonlinear mixed integer programming model which is proved to be NP-hard. We develop a Lagrangian relaxation-based (LR) heuristic solution algorithm and demonstrate its computational efficiency for solving large-scale problems.

Suggested Citation

  • Li, Qingwei & Savachkin, Alex, 2013. "A heuristic approach to the design of fortified distribution networks," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 50(C), pages 138-148.
    • Handle: RePEc:eee:transe:v:50:y:2013:i:c:p:138-148
    DOI: 10.1016/j.tre.2012.10.004
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    1. Marshall L. Fisher, 2004. "The Lagrangian Relaxation Method for Solving Integer Programming Problems," Management Science, INFORMS, vol. 50(12_supple), pages 1861-1871, December.
    2. Tingting Cui & Yanfeng Ouyang & Zuo-Jun Max Shen, 2010. "Reliable Facility Location Design Under the Risk of Disruptions," Operations Research, INFORMS, vol. 58(4-part-1), pages 998-1011, August.
    3. Scaparra, Maria P. & Church, Richard L., 2008. "An exact solution approach for the interdiction median problem with fortification," European Journal of Operational Research, Elsevier, vol. 189(1), pages 76-92, August.
    4. Li, Xiaopeng & Ouyang, Yanfeng, 2010. "A continuum approximation approach to reliable facility location design under correlated probabilistic disruptions," Transportation Research Part B: Methodological, Elsevier, vol. 44(4), pages 535-548, May.
    5. Cui, Tingting & Ouyang, Yanfeng & Shen, Zuo-Jun Max J, 2010. "Reliable Facility Location Design under the Risk of Disruptions," University of California Transportation Center, Working Papers qt5sh2c7pw, University of California Transportation Center.
    6. Peng, Peng & Snyder, Lawrence V. & Lim, Andrew & Liu, Zuli, 2011. "Reliable logistics networks design with facility disruptions," Transportation Research Part B: Methodological, Elsevier, vol. 45(8), pages 1190-1211, September.
    7. Lawrence V. Snyder & Mark S. Daskin, 2005. "Reliability Models for Facility Location: The Expected Failure Cost Case," Transportation Science, INFORMS, vol. 39(3), pages 400-416, August.
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    Cited by:

    1. Azad, Nader & Hassini, Elkafi, 2019. "Recovery strategies from major supply disruptions in single and multiple sourcing networks," European Journal of Operational Research, Elsevier, vol. 275(2), pages 481-501.
    2. Luohao Tang & Cheng Zhu & Zaili Lin & Jianmai Shi & Weiming Zhang, 2016. "Reliable Facility Location Problem with Facility Protection," PLOS ONE, Public Library of Science, vol. 11(9), pages 1-24, September.
    3. Qingwei Li & Alex Savachkin, 2016. "Reliable distribution networks design with nonlinear fortification function," International Journal of Systems Science, Taylor & Francis Journals, vol. 47(4), pages 805-813, March.
    4. Nayeri, Sina & Sazvar, Zeinab & Heydari, Jafar, 2022. "A global-responsive supply chain considering sustainability and resiliency: Application in the medical devices industry," Socio-Economic Planning Sciences, Elsevier, vol. 82(PB).
    5. Nader Azad & Elkafi Hassini, 2019. "A Benders Decomposition Method for Designing Reliable Supply Chain Networks Accounting for Multimitigation Strategies and Demand Losses," Transportation Science, INFORMS, vol. 53(5), pages 1287-1312, September.
    6. Jabbarzadeh, Armin & Fahimnia, Behnam & Sheu, Jiuh-Biing & Moghadam, Hani Shahmoradi, 2016. "Designing a supply chain resilient to major disruptions and supply/demand interruptions," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 121-149.
    7. Mohammad Ali Nasiri Khalili & Mostafa Kafaei Razavi & Morteza Kafaee Razavi, 2016. "An Optimized Mathematical Model for Items Supplies Planning of a Logistic System," Modern Applied Science, Canadian Center of Science and Education, vol. 10(10), pages 133-133, October.
    8. Salehi Sadghiani, N. & Torabi, S.A. & Sahebjamnia, N., 2015. "Retail supply chain network design under operational and disruption risks," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 75(C), pages 95-114.
    9. Fahimnia, Behnam & Jabbarzadeh, Armin & Sarkis, Joseph, 2018. "Greening versus resilience: A supply chain design perspective," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 119(C), pages 129-148.

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