Authors
Francesca Maggioni, Michal Kaut, Luca Bertazzi
Publication date
2009/5
Journal
Computational Management Science
Volume
6
Pages
251-267
Publisher
Springer-Verlag
Description
In this paper, we study a single-sink transportation problem in which the production capacity of the suppliers and the demand of the single customer are stochastic. Shipments are performed by capacitated vehicles, which have to be booked in advance, before the realization of the production capacity and the demand. Once the production capacity and the demand are revealed, there is an option to cancel some of the booked vehicles against a cancellation fee; if the quantity shipped from the suppliers using the booked vehicles is not enough to satisfy the demand, the residual quantity is purchased from an external company. The problem is to determine the number of vehicles to book in order to minimize the total cost. We formulate a two-stage and a multistage stochastic mixed integer linear programming models to solve this problem and test them on a real case provided by Italcementi, the primary Italian …
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