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3884. A location and assortment problem for e-commerce distribution with returns and transshipments
Invited abstract in session MA-31: Recommender systems, stream Analytics.
Monday, 8:30-10:00Room: 046 (building: 208)
Authors (first author is the speaker)
| 1. | Joris van Oers
|
| School of Industrial Engineering and Innovation Sciences, Eindhoven University of Technology | |
| 2. | Quang-Vinh Dang
|
| Department of Industrial Engineering and Innovation Sciences, Eindhoven University of Technology | |
| 3. | Zumbul Atan
|
| Technical University of Eindhoven | |
| 4. | Ivo Adan
|
| School of Industrial Engineering, Eindhoven University of Technology |
Abstract
As customer demand changes over time, reevaluation of strategic decisions concerning network design becomes imperative. However, this entails significant investment in capital goods, necessitating resilience to future disruptions. Consequently, this crucial decision often gets deferred in practice, leading to inefficient distribution networks. To address this challenge, we introduce a robust decision-support tool for evaluating strategic choices under varying scenarios. Specifically, our focus lies on the optimization problem of facility location and network design (FLNDP) within a distribution network. This involves selecting the optimal subset of new warehouses to open from a set of potential locations, taking into account the significant return flow of items. In addition, a strategic planner can opt to equip the opened warehouses with facilities for inspecting returned items at fixed costs. Our contribution is twofold. First, we develop a mathematical model to solve the FLNDP that allows for transshipments between warehouses, in contrast to earlier literature. This results in notable differences in the optimal solution of the network design, due to the imposition of fixed setup costs for transportation. Second, we provide managerial insights by evaluating a use case with real-world data, featuring disruptions from a pandemic and geopolitical shifts within Europe.
Keywords
- Facilities Planning and Design
- Network Design
- Supply Chain Management
Status: accepted
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