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Multilocation Plant Sizing and Timing

Author

Listed:
  • Ram C. Rao

    (Queen's University, Canada)

  • David P. Rutenberg

    (Carnegie-Mellon University, Currently at Queen's University)

Abstract

In this paper we solve a dynamic multilocation problem. Time is continuous, and demands can grow at varying rates in different markets and at different times. There are economies of scale in building plant capacity. To solve such a problem conditional on a prescribed sequence, we show how to use recent insights into the transportation problem to develop constructive algorithms that are computationally viable and attractive even for large problems. With plant sizes held constant, transportation cost is optimized through continuous time so as to set plant timings. We then treat the plant sizes (and some timings) as continuous variables in a feasible directions procedure to move towards a local optimum.

Suggested Citation

  • Ram C. Rao & David P. Rutenberg, 1977. "Multilocation Plant Sizing and Timing," Management Science, INFORMS, vol. 23(11), pages 1187-1198, July.
    • Handle: RePEc:inm:ormnsc:v:23:y:1977:i:11:p:1187-1198
    DOI: 10.1287/mnsc.23.11.1187
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    File URL: http://dx.doi.org/10.1287/mnsc.23.11.1187
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    Cited by:

    1. V. Balachandran, 1977. "A Survey of the Applications of the Operator Theory of Parametric Programming for the Transportation and Generalized Transportation Problems," Discussion Papers 300, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    2. A Dasci & G Laporte, 2005. "An analytical approach to the facility location and capacity acquisition problem under demand uncertainty," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(4), pages 397-405, April.

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