Dynamic Facility Location with Stochastic Demand

Subject Areas : Business Strategy

Ali Gholinejad Devin ¹ , Katayun Abedzade Ghuchani ² , Reza Sadeghi ³ , Hamidreza Koosha ⁴

1 - Sadjad institution of higher education, Mashhad, Iran
2 - Sadjad institution of higher education, Mashhad, Iran
3 - Imam Reza international university, Mashhad, Iran
4 - Department of Industrial Engineering, Ferdowsi University of Mashhad, Mashhad, Iran

Received: 2015-02-22 Accepted : 2015-06-01 Published : 2017-07-01

Keywords: Location problem, stochastic modeling, Stochastic Dynamic Location, Stochastic Constrains, Stochastic demand,

Abstract :

Determination of facilities, such as factories or warehouses, location and availability conditions is one of the important and strategic decisions for an organization to make. Transportation costs that form a major part of goods price are dependent to this decision making. There are verity of methods have been presented to achieve the optimal locations of these facilities which are generally deterministic. In real world accurate estimation of the effective parameters on this optimal location for single or multiple time periods is difficult and merely impossible.In this research, we try to achieve an efficient model with consideration of uncertainty demand over different time periods on the basis of previously presented models that we call stochastic dynamic facilities location problem. In order to do so we use stochastic constrain programming which convert the stochastic model to a deterministic one. According to this conversion we can use the cutting edge standard algorithm and methods of programing to solve the model. Next we implement the presented model for a case study and solve the problem with MATLAB software and examine the efficiency of model. Implementation the presented model and analyzing the results cause better management and better control of changing facility status