Development and analysis of heuristic algorithms for a two-stage supply chain allocation problem with a fixed transportation cost

Abstract

In a transportation problem, when fixed cost is also taken into account in addition to the transportation cost per unit, the problem is known as fixed charge transportation problem (FCTP). The objective of an FCTP is to find the combination of routes that minimises the total distribution costs satisfying the supply and demand constraints. It is not possible to solve an FCTP optimally in polynomial time. This forces the researchers and practitioners to seek efficient non-traditional optimisation techniques that can provide near-optimal solutions in lesser time. Accordingly, this paper proposes two novel heuristic algorithms namely; genetic algorithm (GA)-based heuristic and ant colony optimisation (ACO)-based heuristic for solving an FCTP in a two-stage supply chain. The comparative analysis carried out in this study reveals that the solutions obtained using ACO-based heuristic are better than those obtained using GA-based heuristic in terms of total cost and computational time.