A facility neighborhood search heuristic for capacitated facility location with single-source constraints and flexible demand

Authors:
Chase Rainwater;Joseph Geunes;H. Edwin Romeijn
Affiliations:
Department of Industrial Engineering, University of Arkansas, Fayetteville, USA 72701;Department of Industrial and Systems Engineering, University of Florida, Gainesville, USA 32611-6595;Department of Industrial and Operations Engineering, The University of Michigan, Ann Arbor, USA 48109-2117
Venue:
Journal of Heuristics
Year:
2012

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Abstract

We consider a generalization of the well-known capacitated facility location problem with single source constraints in which customer demand contains a flexible dimension. This work focuses on providing fast and practically implementable optimization-based heuristic solution methods for very large scale problem instances. We offer a unique approach that utilizes a high-quality efficient heuristic within a neighborhood search to address the combined assignment and fixed-charge structure of the underlying optimization problem. We also study the potential benefits of combining our approach with a so-called very large-scale neighborhood search (VLSN) method. As our computational test results indicate, our work offers an attractive solution approach that can be tailored to successfully solve a broad class of problem instances for facility location and similar fixed-charge problems.