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Reconciling Franchisor and Franchisee: A Planar Biobjective Competitive Location and Design Model

In: Recent Advances in Optimization

Author

Listed:
  • José Fernández

    (University of Murcia)

  • Boglárka Tóth

    (University of Murcia
    Research Group on Artificial Intelligence of the Hungarian Academy of Sciences and the University of Szeged)

  • Frank Plastria

    (Vrije Universiteit Brussel)

  • Blas Pelegrín

    (University of Murcia)

Abstract

Summary This paper deals with a hard nonlinear biobjective optimization problem: finding the optimal location and design for a new franchised facility within a region where facilities (both of the franchise and not) already exist and compete for the market. The franchisor and the new franchisee both want to maximise their own profit in the market, but these two objectives are in conflict. Customers patronize all the facilities, old and new, proportionally to their attraction to them. Both resulting objective functions are neither convex nor concave. An interval branch and bound method is proposed to obtain an outer approximation of the whole set of efficient solutions. Computational experiments highlight the different kinds of information provided by this method and by a variation of the lexicographic method.

Suggested Citation

  • José Fernández & Boglárka Tóth & Frank Plastria & Blas Pelegrín, 2006. "Reconciling Franchisor and Franchisee: A Planar Biobjective Competitive Location and Design Model," Lecture Notes in Economics and Mathematical Systems, in: Alberto Seeger (ed.), Recent Advances in Optimization, pages 375-398, Springer.
    • Handle: RePEc:spr:lnechp:978-3-540-28258-7_22
    DOI: 10.1007/3-540-28258-0_22
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    Cited by:

    1. Burcin Bozkaya & Seda Yanik & Selim Balcisoy, 2010. "A GIS-Based Optimization Framework for Competitive Multi-Facility Location-Routing Problem," Networks and Spatial Economics, Springer, vol. 10(3), pages 297-320, September.

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