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2196. Strategic capacity planning for logistics service providers
Invited abstract in session MA-29: Combinatorial Optimization models and applications in Logistics and Transportation I, stream Combinatorial Optimization.
Monday, 8:30-10:00Room: 157 (building: 208)
Authors (first author is the speaker)
| 1. | Ioannis Fragkos
|
| Technology & Operations Management, Rotterdam School of Management |
Abstract
Logistics service providers (LSPs) employ transportation assets like car wagons and containers to meet customer needs. To adequately service these needs, it is essential to use assets with the right capacity for each transportation task. The time needed for these operations can vary due to disruptions in the network, which introduce the need to have additional resources. This situation leads to a complex version of the newsvendor problem, where the LSP must decide the number of assets to acquire and plan their deployment to cater to demands that specify a certain capacity but have an uncertain duration. Any demand that exceeds the planned capacity can be met by using spot assets, although at a higher expense. This concept is applied to an LSP that leases train wagons yearly and manages demand fluctuations through occasional spot train rentals. We formulate a two-stage stochastic program to represent this problem. The formulation's structural features, combined with column generation, lead to an efficient solution method. The effectiveness of our method is demonstrated through computational studies.
Keywords
- Combinatorial Optimization
- Transportation
- Capacity Planning
Status: accepted
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