Two heuristic algorithms for location-inventory-routing models involving two warehouses within multi-echelon supply chain networks

Abstract

In supply chain management, the location of facilities, inventory control, and vehicle routing are three key components. This paper incorporates a two-warehouse inventory system into the location- inventory-routing problems (LIRPs) and develops LIRP models with two warehouses in one-level, two-level, and three-level supply chain networks. This study aims to minimize the average total costs of the models by reducing their average costs. To handle these models, two innovative hybrid algorithms, viz. Clarke and Wright-genetic algorithm (CW-GA) and Clarke and Wright-firefly algorithm (CW-FA) are put forward. Computational experiments and sensitivity analyses are conducted to compare the proposed two algorithms with Baron and test the algorithms’ effectiveness and the models’ feasibility. The management implications of this study are presented from two dimensions: model and method. Finally, future research directions and the gap between models and reality are discussed.