IDEAS home Printed from https://ideas.repec.org/a/spr/cejnor/v14y2006i2p177-192.html
   My bibliography  Save this article

Dynamic VRP in pharmaceutical distribution—a case study

Author

Listed:
  • José Magalhães
  • Jorge Sousa

Abstract

In recent years, the pharmaceutical sector has gone through deep changes, partially due to the ageing of the population and to the increasing of costs in health care services. With margins that are getting lower and lower, the drug distribution problem to pharmacies has become much more important, particularly in large metropolitan areas. As pharmacies demand shorter delivery times, vehicle routing and scheduling problems become harder for distributors. It is recognized that the traditional system based on fixed routes does not fulfil the expectations of pharmacies and may, in some cases, be quite inefficient for distributiors. In this work, a case study has been carried out and a change of the traditional approach is proposed, by adopting a system of variable routes that are dynamically designed, based on orders that are constantly arriving along the day. A dynamic algorithm is therefore proposed, meant to be run several times a day. It has four phases: first, a clustering of the orders is performed; second, potential routes are constructed; third, a route is selected for operation; and finally, that route is subject to an improvement process. The selection of the next route to be launched may be postponed in order to take advantage of subsequent information. The algorithm has been tested in the case study, by simulating one week of operation, and by comparing the results with the plan produced by the traditional way Copyright Springer-Verlag 2006

Suggested Citation

  • José Magalhães & Jorge Sousa, 2006. "Dynamic VRP in pharmaceutical distribution—a case study," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 14(2), pages 177-192, June.
  • Handle: RePEc:spr:cejnor:v:14:y:2006:i:2:p:177-192
    DOI: 10.1007/s10100-006-0167-4
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10100-006-0167-4
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s10100-006-0167-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Gendreau, Michel & Laporte, Gilbert & Seguin, Rene, 1996. "Stochastic vehicle routing," European Journal of Operational Research, Elsevier, vol. 88(1), pages 3-12, January.
    2. Bertsimas, Dimitris & Van Ryzin, Garrett., 1991. "A stochastic and dynamic vehicle routing problem in the Euclidean plane," Working papers 3286-91., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    3. Dimitris J. Bertsimas & Garrett van Ryzin, 1993. "Stochastic and Dynamic Vehicle Routing in the Euclidean Plane with Multiple Capacitated Vehicles," Operations Research, INFORMS, vol. 41(1), pages 60-76, February.
    4. Russell W. Bent & Pascal Van Hentenryck, 2004. "Scenario-Based Planning for Partially Dynamic Vehicle Routing with Stochastic Customers," Operations Research, INFORMS, vol. 52(6), pages 977-987, December.
    5. Éric Taillard & Philippe Badeau & Michel Gendreau & François Guertin & Jean-Yves Potvin, 1997. "A Tabu Search Heuristic for the Vehicle Routing Problem with Soft Time Windows," Transportation Science, INFORMS, vol. 31(2), pages 170-186, May.
    6. Ichoua, Soumia & Gendreau, Michel & Potvin, Jean-Yves, 2003. "Vehicle dispatching with time-dependent travel times," European Journal of Operational Research, Elsevier, vol. 144(2), pages 379-396, January.
    7. Dimitris J. Bertsimas & David Simchi-Levi, 1996. "A New Generation of Vehicle Routing Research: Robust Algorithms, Addressing Uncertainty," Operations Research, INFORMS, vol. 44(2), pages 286-304, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Timajchi, Ali & Mirzapour Al-e-Hashem, Seyed M.J. & Rekik, Yacine, 2019. "Inventory routing problem for hazardous and deteriorating items in the presence of accident risk with transshipment option," International Journal of Production Economics, Elsevier, vol. 209(C), pages 302-315.
    2. Kramer, Raphael & Cordeau, Jean-François & Iori, Manuel, 2019. "Rich vehicle routing with auxiliary depots and anticipated deliveries: An application to pharmaceutical distribution," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 129(C), pages 162-174.
    3. Abdelkader Sbihi & Richard W. Eglese, 2007. "The Relationship between Vehicle Routing & Scheduling and Green Logistics - A Literature Survey," Working Papers hal-00644133, HAL.
    4. Lahyani, Rahma & Khemakhem, Mahdi & Semet, Frédéric, 2015. "Rich vehicle routing problems: From a taxonomy to a definition," European Journal of Operational Research, Elsevier, vol. 241(1), pages 1-14.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pillac, Victor & Gendreau, Michel & Guéret, Christelle & Medaglia, Andrés L., 2013. "A review of dynamic vehicle routing problems," European Journal of Operational Research, Elsevier, vol. 225(1), pages 1-11.
    2. Van Woensel, T. & Kerbache, L. & Peremans, H. & Vandaele, N., 2008. "Vehicle routing with dynamic travel times: A queueing approach," European Journal of Operational Research, Elsevier, vol. 186(3), pages 990-1007, May.
    3. Soumia Ichoua & Michel Gendreau & Jean-Yves Potvin, 2006. "Exploiting Knowledge About Future Demands for Real-Time Vehicle Dispatching," Transportation Science, INFORMS, vol. 40(2), pages 211-225, May.
    4. Lars M. Hvattum & Arne Løkketangen & Gilbert Laporte, 2006. "Solving a Dynamic and Stochastic Vehicle Routing Problem with a Sample Scenario Hedging Heuristic," Transportation Science, INFORMS, vol. 40(4), pages 421-438, November.
    5. Barrett W. Thomas & Chelsea C. White, 2004. "Anticipatory Route Selection," Transportation Science, INFORMS, vol. 38(4), pages 473-487, November.
    6. Chen, Lichun & Miller-Hooks, Elise, 2012. "Optimal team deployment in urban search and rescue," Transportation Research Part B: Methodological, Elsevier, vol. 46(8), pages 984-999.
    7. E. Angelelli & R. Mansini & M. Vindigni, 2016. "The Stochastic and Dynamic Traveling Purchaser Problem," Transportation Science, INFORMS, vol. 50(2), pages 642-658, May.
    8. Said Dabia & Stefan Ropke & Tom van Woensel & Ton De Kok, 2013. "Branch and Price for the Time-Dependent Vehicle Routing Problem with Time Windows," Transportation Science, INFORMS, vol. 47(3), pages 380-396, August.
    9. Chiang, Wen-Chyuan & Russell, Robert & Xu, Xiaojing & Zepeda, David, 2009. "A simulation/metaheuristic approach to newspaper production and distribution supply chain problems," International Journal of Production Economics, Elsevier, vol. 121(2), pages 752-767, October.
    10. Zhang, Jian & Woensel, Tom Van, 2023. "Dynamic vehicle routing with random requests: A literature review," International Journal of Production Economics, Elsevier, vol. 256(C).
    11. Noah Gans & Garrett van Ryzin, 1999. "Dynamic Vehicle Dispatching: Optimal Heavy Traffic Performance and Practical Insights," Operations Research, INFORMS, vol. 47(5), pages 675-692, October.
    12. Jian Yang & Patrick Jaillet & Hani Mahmassani, 2004. "Real-Time Multivehicle Truckload Pickup and Delivery Problems," Transportation Science, INFORMS, vol. 38(2), pages 135-148, May.
    13. Sheng Liu & Long He & Zuo-Jun Max Shen, 2021. "On-Time Last-Mile Delivery: Order Assignment with Travel-Time Predictors," Management Science, INFORMS, vol. 67(7), pages 4095-4119, July.
    14. Briseida Sarasola & Karl Doerner & Verena Schmid & Enrique Alba, 2016. "Variable neighborhood search for the stochastic and dynamic vehicle routing problem," Annals of Operations Research, Springer, vol. 236(2), pages 425-461, January.
    15. Jürgen Branke & Martin Middendorf & Guntram Noeth & Maged Dessouky, 2005. "Waiting Strategies for Dynamic Vehicle Routing," Transportation Science, INFORMS, vol. 39(3), pages 298-312, August.
    16. Saint-Guillain, Michael & Paquay, Célia & Limbourg, Sabine, 2021. "Time-dependent stochastic vehicle routing problem with random requests: Application to online police patrol management in Brussels," European Journal of Operational Research, Elsevier, vol. 292(3), pages 869-885.
    17. Wang, Xuping & Ruan, Junhu & Shi, Yan, 2012. "A recovery model for combinational disruptions in logistics delivery: Considering the real-world participators," International Journal of Production Economics, Elsevier, vol. 140(1), pages 508-520.
    18. Alejandro Toriello & William B. Haskell & Michael Poremba, 2014. "A Dynamic Traveling Salesman Problem with Stochastic Arc Costs," Operations Research, INFORMS, vol. 62(5), pages 1107-1125, October.
    19. Xiong Hao & Yan Huili, 2019. "General Method of Building a Real-Time Optimization Policy for Dynamic Vehicle Routing Problem," Journal of Systems Science and Information, De Gruyter, vol. 7(6), pages 584-598, December.
    20. Russell W. Bent & Pascal Van Hentenryck, 2004. "Scenario-Based Planning for Partially Dynamic Vehicle Routing with Stochastic Customers," Operations Research, INFORMS, vol. 52(6), pages 977-987, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:cejnor:v:14:y:2006:i:2:p:177-192. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.