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A simulation–optimization approach for a service-constrained multi-echelon distribution network

A simulation–optimization approach for a service-constrained multi-echelon distribution network
A simulation–optimization approach for a service-constrained multi-echelon distribution network
Academic research on (s,S) inventory policies for multi-echelon distribution networks with deterministic lead times, backordering, and fill rate constraints is limited. Inspired by a real-life Dutch food retail case we develop a simulation-optimization approach to optimize (s,S) inventory policies in such a setting. We compare the performance of a Nested Bisection Search (NBS) and a novel Scatter Search (SS) metaheuristic using 1280 instances from literature and we derive managerial implications from a real-life case. Results show that the SS outperforms the NBS on solution quality. Additionally, supply chain costs can be saved by allowing lower fill rates at upstream echelons.
1366-5545
292-311
Noordhoek, M.
cb70b959-5def-4f9d-a5d1-ac0e9d5701ef
Dullaert, W.
315bc5f3-4982-42d7-a659-2bf8e910b7ba
Lai, D.S.W.
9e095afb-da7c-42e3-9e3e-a609bf12da57
de Leeuw, S.
e8b7d29a-1088-4b5b-acdc-948a21fe300b
Noordhoek, M.
cb70b959-5def-4f9d-a5d1-ac0e9d5701ef
Dullaert, W.
315bc5f3-4982-42d7-a659-2bf8e910b7ba
Lai, D.S.W.
9e095afb-da7c-42e3-9e3e-a609bf12da57
de Leeuw, S.
e8b7d29a-1088-4b5b-acdc-948a21fe300b

Noordhoek, M., Dullaert, W., Lai, D.S.W. and de Leeuw, S. (2018) A simulation–optimization approach for a service-constrained multi-echelon distribution network. Transportation Research Part E: Logistics and Transportation Review, 114, 292-311. (doi:10.1016/j.tre.2018.02.006).

Record type: Article

Abstract

Academic research on (s,S) inventory policies for multi-echelon distribution networks with deterministic lead times, backordering, and fill rate constraints is limited. Inspired by a real-life Dutch food retail case we develop a simulation-optimization approach to optimize (s,S) inventory policies in such a setting. We compare the performance of a Nested Bisection Search (NBS) and a novel Scatter Search (SS) metaheuristic using 1280 instances from literature and we derive managerial implications from a real-life case. Results show that the SS outperforms the NBS on solution quality. Additionally, supply chain costs can be saved by allowing lower fill rates at upstream echelons.

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More information

Accepted/In Press date: 10 February 2018
e-pub ahead of print date: 9 May 2018

Identifiers

Local EPrints ID: 457652
URI: http://eprints.soton.ac.uk/id/eprint/457652
ISSN: 1366-5545
PURE UUID: 3d6afa0e-d6c3-4d67-ba9e-e5b35caa1366
ORCID for D.S.W. Lai: ORCID iD orcid.org/0000-0002-9989-1485

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Date deposited: 14 Jun 2022 16:56
Last modified: 15 Jun 2022 01:59

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Contributors

Author: M. Noordhoek
Author: W. Dullaert
Author: D.S.W. Lai ORCID iD
Author: S. de Leeuw

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