Helmberg, Christoph ; Röhl, Stefan : A Case Study of Joint Online Truck Scheduling and Inventory Management for Multiple Warehouses
- Author(s):
-
Helmberg, Christoph
Röhl, Stefan
- Title:
- A Case Study of Joint Online Truck Scheduling and Inventory Management for Multiple Warehouses
- Electronic source:
-
application/pdf
- Preprint series:
- Technische Universität Chemnitz, Fakultät für Mathematik (Germany). Preprint 3, 2005
- Mathematics Subject Classification:
-
90B06 [ Transportation, logistics ] 90C06 [ Large-scale problems ] 90C90 [ Applications of mathematical programming ] 90B05 [ Inventory, storage, reservoirs ] - Abstract:
- For a real world problem --- transporting pallets between warehouses in order to guarantee sufficient supply for known and additional stochastic demand --- we propose a solution approach via convex relaxation of an integer programming formulation, suitable for online optimization. The essential new element linking routing and inventory management is a convex piecewise linear cost function that is based on minimizing the expected number of pallets that still need transportation. For speed, the convex relaxation is solved approximately by a bundle approach yielding an online schedule in 5 to 12 minutes for up to 3 warehouses and 40000 articles; in contrast, computation times of state of the art LP-solvers are prohibitive for online application. In extensive numerical experiments on a real world data stream, the approximate solutions exhibit negligible loss in quality; in long term simulations the proposed method reduces the average number of pallets needing transportation due to short term demand to less than half the number observed in the data stream.
- Keywords:
- convex relaxation, integer programming, stochastic demand, network models, large scale problems, bundle method, logistics, vehicle routing
- Language:
-
English
- Publication time:
- 1 / 2005
