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Mathematical Problems in Engineering
Volume 2015, Article ID 473172, 13 pages
http://dx.doi.org/10.1155/2015/473172
Research Article

Integrated Location-Production-Distribution Planning in a Multiproducts Supply Chain Network Design Model

1Department of Industrial Management, National Taiwan University of Science and Technology, No. 43, Section 4, Keelung Road, Taipei 10607, Taiwan
2Industrial and Manufacturing Engineering, Asian Institute of Technology, 58 Moo 9, Paholyothin Highway Klong Luang, Pathumthani 12120, Thailand

Received 31 October 2014; Revised 7 February 2015; Accepted 23 February 2015

Academic Editor: Xuefeng Chen

Copyright © 2015 Vincent F. Yu et al. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

This paper proposes integrated location, production, and distribution planning for the supply chain network design which focuses on selecting the appropriate locations to build a new plant and distribution center while deciding the production and distribution of the product. We examine a multiechelon supply chain that includes suppliers, plants, and distribution centers and develop a mathematical model that aims at minimizing the total cost of the supply chain. In particular, the mathematical model considers the decision of how many plants and distribution centers to open and where to open them, as well as the allocation in each echelon. The LINGO software is used to solve the model for some problem cases. The study conducts various numerical experiments to illustrate the applicability of the developed model. Results show that, in small and medium size of problem, the optimal solution can be found using this solver. Sensitivity analysis is also conducted and shows that customer demand parameter has the greatest impact on the optimal solution.