Multilocation plant sizing and timing: a study of some decomposition procedures

Abstract This paper attempts to study the multilocation plant sizing and timing problem by using some decomposition procedures. The problem considered here concerns the determination of optimum capacity and timing to satisfy the growing demand to minimise the present value of plant fixed costs, plus the present value of streams of operating and transportation costs. A nonlinear objective function with probabilistic demand constraints over a finite planning horizon is considered for analysis. Three decomposition procedures are designed to facilitate solution by reduction of the complex problem to a sequence of simpler problems. Sensitivity analysis with respect to demands and problem size have been carried out to provide directions for large-scale problem analysis. A relative comparison between the various decomposition procedures has been presented to highlight the potentials and limitations of each procedure.