A Deterministic Model for the Transshipment Problem of a Fast Fashion Retailer under Capacity Constraints
| Autor: | Kemal Kilic, Abdullah Dasci, Siamak Naderi |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Economics and Econometrics
Mathematical optimization Linear programming Transshipment (information security) Computer science Transshipment problem 0211 other engineering and technologies 02 engineering and technology Fast fashion Management Science and Operations Research Industrial and Manufacturing Engineering T Technology (General) symbols.namesake 0502 economics and business FOS: Mathematics Metaheuristic Mathematics - Optimization and Control 021103 operations research 05 social sciences General Business Management and Accounting Transshipment Lagrangian relaxation HF5410-5417.5 Marketing. Distribution of products Optimization and Control (math.OC) Simulated annealing symbols 050203 business & management Integer (computer science) |
| DOI: | 10.48550/arxiv.2001.02499 |
| Popis: | In this paper we present a novel transshipment problem for a large apparel retailer that operates an extensive retail network. Our problem is inspired by the logistics operations of a very large fast fashion retailer in Turkey, LC Waikiki, with over 450 retail branches and thousands of products. The purpose of transshipments is to rebalance stocks across the retail network to better match supply with demand. We formulate this problem as a large mixed integer linear program and develop a Lagrangian relaxation with a primal-dual approach to find upper bounds and a simulated annealing based metaheuristic to find promising solutions, both of which have proven to be quite effective. While our metaheuristic does not always produce better solutions than a commercial optimizer, it has consistently produced solutions with optimality gaps lower than 7% while the commercial optimizer may produce very poor solutions with optimality gaps as high as almost 300%. We have also conducted a set of numerical experiments to uncover implications of various operational practices of LC Waikiki on its system's performance and important managerial insights. Comment: Submitted to the International Journal of Production Economics |
| Databáze: | OpenAIRE |
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