Solving the Multi-Depot Location-Routing Problem with Lagrangian Relaxation

Multi-depot Location-Routing Problem (MDLRP) is about finding the optimal number and locations of depots while allocating customers to depots and determining vehicle routes to visit all customers. In this study we propose a nested Lagrangian relaxation-based method for the discrete uncapacitated MDLRP. An outer Lagrangian relaxation embedded in subgradient optimization decomposes the parent problem into two subproblems. The first subproblem is a facility location-like problem. It is solved to optimaliy with Cplex 9.0. The second one resembles a capacitated and degree constrained minimum spanning forest problem, which is tackled with an augmented Lagrangian relaxation. The solution of the first subproblem reveals a depot location plan. As soon as a new distinct location plan is found in the course of the subgradient iterations, a tabu search algorithm is triggered to solve the multi-depot vehicle routing problem associated with that plan, and a feasible solution to the parent problem is obtained. Its objective value is checked against the current upper bound on the parent problem’s true optimal objective value. The performance of the proposed method has been observed on a number of test problems, and the results have been tabulated.