Tabu Search
A Transportation Problem with Minimum Quantity Commitment
Transportation Science
An efficient optimal algorithm for the quantity discount problem in material requirement planning
Computers and Operations Research
Approximation of the supply scheduling problem
Operations Research Letters
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This study is motivated by a project awarded by one of the largest international retail distributors in the world. An important task for the distributor is to plan the distribution of goods from Asia to various destinations across Europe. The goods are transported by shipping companies along shipping lanes, and these companies offer different discount rates depending on the freight quantity. The task involves purchasing freight capacity from shipping companies for each shipping lane based on projected demand, and subject to minimum quantity requirements, such that the total transportation cost is minimized. Existing work on this and related problems employs commercial linear programming software to solve their models. The problem is NP-hard, and is therefore unlikely to be solvable optimally in reasonable time for large instances. Hence, we propose a heuristic-based algorithm that combines a filter and fan search scheme with a tabu search mechanism for the problem. Experiments on randomly generated test instances show that our algorithm produces superior solutions in less computation time and requires less computer memory compared to ILOG CPLEX 11.0.