A novel method to handle route failure in fuzzy vehicle routing problem with hard time windows and uncertain demand

Abstract

In this paper, a fuzzy vehicle routing problem with hard time windows (FVRPTW) having uncertain demand is addressed. Since customer's demand is assumed to be known only upon arrival at customer location, a planned route may fail to meet realised demand of customer. This situation is known as route failure. Instead of adopting simple recourse methods to handle route failure, this paper proposes a novel method titled 'non-restocking' to solve route failure. The problem is formulated as a two stage recourse model with an objective of minimising the total cost and at the same time maximising the obtained sale in a competitive environment. Uncertainty in demand is represented by fuzzy numbers. Route construction for the modelled problem is done by ant colony system. The computational results show that the proposed two stage model with the proposed new recourse scheme produces high quality solutions. Benefits of the proposed method are demonstrated by applying it to milk routing problem.