Integrated production and distribution planning for single-period inventory products

Abstract

Many firms try separately to optimise their production and distribution functions, but such separation may limit the potential savings. Nowadays, it is more important to analyse these two functions simultaneously by trading off the costs associated with the whole. In this paper, a mixed integer linear programming model is constructed and a hybrid genetic algorithm is proposed incorporating several local optimisation techniques for production and distribution planning problems of single-period inventory products, with the aim of optimally coordinating and integrating the interrelated decisions of production sequencing and vehicle routing. Computational results on the various test problems demonstrate the capability of the proposed algorithm to obtain solutions that are very close to those obtained by the mathematical model for small problems and confirm the effectiveness of the integrated planning approach over the decoupled planning method in which vehicle routing is first developed and a production sequence is subsequently derived. Finally, an investigation is undertaken of the effects of the problem parameters on the effectiveness of the integrated planning approach through sensitivity analysis.

Keywords:

• integrated and decoupled production and distribution planning
• single-period inventory products
• hybrid genetic algorithm
• supply chain management