Design and Optimization of Single-Stage Multi-Product Supply Chain Network for Product Distribution: A Case Study

Abstract

Network design and optimization problems for product distribution appear widely in shipping applications with the main objective to minimize the shipping cost, as the product distribution accounts for a significant portion of the logistical costs. The impact of various factors (traffic factor, cross route costs, production time constraints and demand time for product) on the total cost are analyzed in this paper. The procedure developed leads to considerable improvement in terms of supply route selection, allocation of customers to production facilities, location of production facilities and minimizing the total cost. An integer LP mathematical model for multi-product flow is formulated and test problems are solved to analyze the performance of the model when the network characteristics are changed. The results obtained show that the performance of the model is efficient for all test problems.