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Algorithms for the multi‐item multi‐vehicles dynamic lot sizing problem

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  • Shoshana Anily
  • Michal Tzur

Abstract

We consider a two‐stage supply chain, in which multi‐items are shipped from a manufacturing facility or a central warehouse to a downstream retailer that faces deterministic external demand for each of the items over a finite planning horizon. The items are shipped through identical capacitated vehicles, each incurring a fixed cost per trip. In addition, there exist item‐dependent variable shipping costs and inventory holding costs at the retailer for items stored at the end of the period; these costs are constant over time. The sum of all costs must be minimized while satisfying the external demand without backlogging. In this paper we develop a search algorithm to solve the problem optimally. Our search algorithm, although exponential in the worst case, is very efficient empirically due to new properties of the optimal solution that we found, which allow us to restrict the number of solutions examined. Second, we perform a computational study that compares the empirical running time of our search methods to other available exact solution methods to the problem. Finally, we characterize the conditions under which each of the solution methods is likely to be faster than the others and suggest efficient heuristic solutions that we recommend using when the problem is large in all dimensions. © 2005 Wiley Periodicals, Inc. Naval Research Logistics, 2006.

Suggested Citation

  • Shoshana Anily & Michal Tzur, 2006. "Algorithms for the multi‐item multi‐vehicles dynamic lot sizing problem," Naval Research Logistics (NRL), John Wiley & Sons, vol. 53(2), pages 157-169, March.
  • Handle: RePEc:wly:navres:v:53:y:2006:i:2:p:157-169
    DOI: 10.1002/nav.20129
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    6. Shoshana Anily & Michal Tzur, 2005. "Shipping Multiple Items by Capacitated Vehicles: An Optimal Dynamic Programming Approach," Transportation Science, INFORMS, vol. 39(2), pages 233-248, May.
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    Cited by:

    1. Martin Grunewald & Thomas Volling & Christoph Müller & Thomas S. Spengler, 2018. "Multi-item single-source ordering with detailed consideration of transportation capacities," Journal of Business Economics, Springer, vol. 88(7), pages 971-1007, September.

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