A stochastic programming model for emergency supplies allocation with consideration of production capacity reserves of enterprise

HU Shaolong, HAN Chuanfeng, MENG Lingpeng, WU Qidi

Systems Engineering - Theory & Practice ›› 2018, Vol. 38 ›› Issue (6) : 1536-1544.

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PDF(879 KB)
Systems Engineering - Theory & Practice ›› 2018, Vol. 38 ›› Issue (6) : 1536-1544. DOI: 10.12011/1000-6788(2018)06-1536-09

A stochastic programming model for emergency supplies allocation with consideration of production capacity reserves of enterprise

  • HU Shaolong1, HAN Chuanfeng1, MENG Lingpeng2, WU Qidi2
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Abstract

The uncertainty of demand impose great impact on emergency supplies allocation. The inappropriate decisions may easily result in insufficient supply or waste. The production capacity of enterprise and uncertainties in disaster-affected locations and demand are integrated in a two-stage stochastic programming model, which are configured with the objectives of minimizing economic and penalty costs. The location of enterprises and physical inventory are determined in the first stage. Then, depending on demand for scenarios, production and distribution decisions are made in the second stage. A sample average approximation method is proposed for solving the model. Based on data from snowstorm, earthquake, flood and typhoon in China, 2008, a serial scenarios are designed for numerical studies. The results show that storing production capacity for supplies and introducing penalty for delay and shortage of demand are beneficial for decreasing physical inventory and risk of insufficient supply. Moreover, physical inventory and production capacity should be greatly increased if minimizing risk of insufficient supply, which may easily result in waste of resources.

Key words

emergency supplies allocation / location / production capacity reserves / two-stage stochastic programming / sample average approximation method

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HU Shaolong , HAN Chuanfeng , MENG Lingpeng , WU Qidi. A stochastic programming model for emergency supplies allocation with consideration of production capacity reserves of enterprise. Systems Engineering - Theory & Practice, 2018, 38(6): 1536-1544 https://doi.org/10.12011/1000-6788(2018)06-1536-09

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Funding

National Natural Science Foundation of China (71503185, 91224003, 71403186)
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