Restructuring Facility Networks under Economy of Scales
Marta Sofia R. Monteiro
Dalila B. M. M. Fontes
Fernando A. C. C. Fontes
In this work we address the facility network restructuring problem. This problem is closely related to location/allocation and set covering problems. However, none of the above includes all its complexity nor involves all the decision types. Due to the presence of economies of scale, another type of complexity arises since we must minimize a concave cost function. Therefore we are extending current literature by considering a new problem. For this problem a local search heuristic is proposed, where an initially feasible solution, obtained by solving a related linear problem, is improved by a slope scaling procedure and then by drop and swap operations. Computational results showing the effectiveness and efficiency of the solution procedure are reported.
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