Optimal model for warehouse location and retailer allocation

Warehouse location and retailer allocation is a high-level strategic decision problem that is commonly encountered by logisticians and supply chain managers, especially during the supply chain design phase. Considering the product distribution cost and warehouse capital cost trade-offs, this paper models the warehouse location and retailer allocation problem as a 0–1 integer programming problem and provides an efficient two-stage set covering heuristic algorithm to solve large-sized problems. Finally, concluding remarks and some recommendations for further research are also presented. Copyright © 2007 John Wiley & Sons, Ltd.

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