Computational Limitations of Dynamic Programming for Warehouse Location: A Comment
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practice. Heuristic methods might be used to obtain good, but not necessarily optimal, solutions. Ballou has presented a new dynamic aspect of the warehouse location problem. However, his approach can not handle realistic problems computationally where a company has a reasonable number of warehouses whose locations are interdependent in terms of profitability during a time period. On the other hand, some static solution procedures such as Shycon and Maffei's [2] or Kuehn and Hamburger's [3] can reflect these interdependencies but do not consider the dynamic factors such as demand changes and moving costs. Combination of both approaches in a computationally feasible manner is still in the realm of further research.
[1] W. Baumol,et al. A Warehouse-Location Problem , 1958 .
[2] Ronald H. Ballou,et al. Dynamic Warehouse Location Analysis , 1968 .
[3] Alfred A. Kuehn,et al. A Heuristic Program for Locating Warehouses , 1963 .