A Meta-Heuristic Approach to a Strategic Mixed Inventory-Location Model: Formulation and Application

Abstract In the present day, it is increasingly more important for the companies to have a distribution network that minimize the logistic costs without reducing the level of service to the customer (delivery time, enough inventory, etc.). To reach conciliation within these objectives that may look conflicting requires developing some tools that allow decision-making. Having this in mind, the authors present a strategic inventory-location model, multiproduct and different with demand periods. This is a complex problem of integer mixed programming, that allow to determine the optimum distribution network given the fixed, transportation and inventory costs. The problem is illustrated by applying it to a real case of a steel company in Colombia, to resolve it, exhaustive revision and a genetic algorithm were used. The results obtained reveal the importance of the making joint strategic-tactic decisions, as well as the impact of each of the variables considered in the logistics costs.