Article ID Journal Published Year Pages File Type
1023096 Transportation Research Part E: Logistics and Transportation Review 2015 34 Pages PDF
Abstract

•Supply chain network design with capacity planning and dynamic pricing is introduced.•A mixed-integer linear programming model is developed for the problem.•SA is combined with developed linear relaxation-based heuristics as a solution approach.•The efficiency of the solution approach is shown by computational results.•Some managerial insights are driven from several numerical experiments.

This paper addresses a new problem in designing and planning a multi-echelon and multi-product supply chain network over a multi-period horizon in which customer zones have price-sensitive demands. Based on price-demand relationships, a generic method is presented to obtain price levels for products and then, a mixed-integer linear programming model is developed. Due to the problem intractability, a simulated annealing algorithm that uses some developed linear relaxation-based heuristics for capacity planning and pricing is presented. Numerical results demonstrate the significance of the model as well as the efficiency of the solution algorithm and linear relaxation-based heuristics.

Related Topics
Social Sciences and Humanities Business, Management and Accounting Business and International Management
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