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A hybrid tabu search based heuristic for the periodic distribution inventory problem with perishable goods

Author

Listed:
  • Ali Diabat

    (Masdar Institute of Science and Technology)

  • Tarek Abdallah

    (New York University)

  • Tung Le

    (LLamasoft, Inc.)

Abstract

Most of the research on integrated inventory and routing problems ignores the case when products are perishable. However, considering the integrated problem with perishable goods is crucial since any discrepancy between the routing and inventory cost can double down the risk of higher obsolescence costs due to the limited shelf-life of the products. In this paper, we consider a distribution problem involving a depot, a set of customers and a homogeneous fleet of capacitated vehicles. Perishable goods are transported from the depot to customers in such a way that out-of-stock situations never occur. The objective is to simultaneously determine the inventory and routing decisions over a given time horizon such that total transportation cost is minimized. We present a new “arc-based formulation” for the problem which is deemed more suitable for our new tabu search based approach for solving the problem. We perform a thorough sensitivity analysis for each of the tabu search parameters individually and use the obtained gaps to fine-tune the parameter values that are used in solving larger sized instances of the problem. We solve different sizes of randomly generated instances and compare the results obtained using the tabu search algorithm to those obtained by solving the problem using CPLEX and a recently published column generation algorithm. Our computational experiments demonstrate that the tabu search algorithm is capable of obtaining a near-optimal solution in less computational time than the time required to solve the problem to optimality using CPLEX, and outperforms the column generation algorithm for solving the “path flow formulation” of the problem in terms of solution quality in almost all of the considered instances.

Suggested Citation

  • Ali Diabat & Tarek Abdallah & Tung Le, 2016. "A hybrid tabu search based heuristic for the periodic distribution inventory problem with perishable goods," Annals of Operations Research, Springer, vol. 242(2), pages 373-398, July.
    • Handle: RePEc:spr:annopr:v:242:y:2016:i:2:d:10.1007_s10479-014-1640-4
    DOI: 10.1007/s10479-014-1640-4
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    References listed on IDEAS

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    2. Alvarez, Aldair & Cordeau, Jean-François & Jans, Raf & Munari, Pedro & Morabito, Reinaldo, 2020. "Formulations, branch-and-cut and a hybrid heuristic algorithm for an inventory routing problem with perishable products," European Journal of Operational Research, Elsevier, vol. 283(2), pages 511-529.
    3. Shiva Zandkarimkhani & Hassan Mina & Mehdi Biuki & Kannan Govindan, 2020. "A chance constrained fuzzy goal programming approach for perishable pharmaceutical supply chain network design," Annals of Operations Research, Springer, vol. 295(1), pages 425-452, December.
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    6. Neves-Moreira, Fábio & Almada-Lobo, Bernardo & Guimarães, Luís & Amorim, Pedro, 2022. "The multi-product inventory-routing problem with pickups and deliveries: Mitigating fluctuating demand via rolling horizon heuristics," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 164(C).
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    8. Melkonyan, Ani & Gruchmann, Tim & Lohmar, Fabian & Kamath, Vasanth & Spinler, Stefan, 2020. "Sustainability assessment of last-mile logistics and distribution strategies: The case of local food networks," International Journal of Production Economics, Elsevier, vol. 228(C).
    9. Kannan Govindan, 2016. "Evolutionary algorithms for supply chain management," Annals of Operations Research, Springer, vol. 242(2), pages 195-206, July.
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