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Multi-Objective Mathematical Model for Pharmaceutical Location-Routing Problem with Potential Demand Approach
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Amir-Mohammad Golmohammadi *   |
| Associate Professor of Industrial Engineering, Arak University, Arak, Iran. , a-golmohammadi@araku.ac.ir |
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Abstract: (148 Views) |
Facility location and routing problems have attracted significant research attention since the 1960s due to their practical relevance and complexity. Efficiently establishing production facilities, optimizing vehicle routes, and implementing effective inventory systems are essential for improving organizational performance. In this study, we propose an integrated location-routing model for the pharmaceutical supply chain, designed to satisfy all retailer demands through an appropriate inventory policy, ensuring no demand is unmet. The proposed mixed-integer mathematical model considers a four-tier supply chain, including manufacturers, distributors, wholesalers, and retailers, with the objective of establishing cost-effective warehouses while fulfilling all demand requirements. Demand uncertainty is addressed using a scenario-based probabilistic approach. The model is solved using GAMS for a small-scale case study. For larger-scale instances, where exact solutions are computationally challenging, a meta-heuristic approach—specifically, a genetic algorithm—is employed to efficiently obtain near-optimal solutions.
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| Keywords: Demand uncertainty, Location routing problem, inventory system, Meta-heuristic algorithm, Pharmaceutical supply chain |
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Type of Study: Original |
Subject:
Mathematical Modeling and Applications of OR
Received: 2025/08/22 | Accepted: 2025/09/26 | Published: 2025/09/26
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