Routing for a Just-in-Time Supply Pickup and Delivery System

An optimization-based approach is developed for routing a just-in-time (JIT) supply pickup and delivery system. The approach defines routes among suppliers serving a large JIT assembly plant, the timing of these routes, and the frequency that they are run (implicitly defining parts quantities picked up each visit). The solutions satisfy various operational constraints at the JIT facility, including requirements for high-frequency/small-quantity deliveries and limits on space for parts storage. The solution space we consider here is restricted by an operational discipline that the industry calls common frequency routing. Under this system we only consider routing designs where each part source is being served by a single route run at a fixed daily frequency instead of designs where multiple routes visit that supplier, each potentially run at a different frequency. This dramatically reduces dimensionality of the problem and is also known to provide both management and operational advantages in practice. In solving the formulation, column generation and tabu search strategies have been developed, the latter suitable for realistic-sized problems. The utility of the approach is illustrated through a number of examples.