Reliable facility location design under set-up cost uncertainty

摘要

This paper studies a reliable facility design problem that optimizes facility locations and network flows under set-up cost uncertainty. We use scenarios to describe set-up cost uncertainties and then we present an mixed-integer programming model that minimizes maximum gap between the suboptimal and optimal total costs (including facility set-up cost and transportation cost) under different scenarios ensuring the total costs not to fluctuate dramatically. We use the tabu search algorithm to solve the problem. Numerical experiment results show that this proposed model is capable of providing a nearoptimum solution which can obtain better network performance.