A decomposition framework for distribution of fluid products by a vendor-managed-inventory methodology

CARLOS A. MENDEZ; DONDO, RODOLFO G.; M. COCCOLA

Proceedings of the 27th European Symposium on Computer Aided Process Engineering ? ESCAPE 27

Elsevier

Año: 2017; p. 1387 - 1392

Vendor-Managed Inventory (VMI) is a business practices based on the cooperationbetween a supplier and its customers in which demand and inventory information fromthe customers are shared with the supplier. The practice is based on the inventoryroutingproblem (IRP), which integrates inventory management, vehicle routing, anddelivery scheduling decisions. Because of the large expenses in distribution andinventorying of chemical products, it is attractive to make use of optimization tools forexploiting as many degrees of freedom as possible in order to save costs. So, wepropose a nested column generation (CG) algorithm for a problem related to thedistribution of multiple chemicals fluids according to the VMI-modality. Our approachbuilds on a CG algorithm in which, for each delivery route, the patterns of delivery offluids are also produced by CG. We describe our implementation and givecomputational results for a test instance.