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3968. A bilevel gradual covering facility location model with customer preferences and different facility types

Invited abstract in session TC-61: Location with Multiple Actors, stream Locational Analysis.

Tuesday, 12:30-14:00
Room: S10 (building: 101)

Authors (first author is the speaker)

1. Hande Kucukaydin
Industrial Engineering, MEF University

Abstract

We address a gradual covering competitive facility location problem where two competing retailers must decide on opening various types of facilities by taking into account customer preferences represented by probabilities for visiting different facility types. It is assumed that customers at a demand point are entirely willing to travel to a specific type of facility when it is located within a full coverage radius. However, if a facility is positioned beyond this full coverage distance, customers are either partially covered or not covered at all. It is also assumed that customers at a demand point can visit several facilities of different types of a retailer. However, among facilities of the same type, customers at a demand point can visit more than one facility of the same type if each facility belongs to a different retailer's chain. In such a case, the captured proportion of the buying power by a single facility is determined by both its own coverage extent and the total coverage provided by all facilities, which may lead to a loss of some buying power. Thus, the revenue generated by a facility depends not only on the visiting probabilities but also on the coverage strength in the presence of competitors. We formulate a nonlinear integer bilevel programming model and propose tabu search heuristics for the solution.

Keywords

Status: accepted

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