Optimizing business location for small and medium enterprises considering travel time uncertainty, natural disasters, and density population: a study case in Jakarta

Abstract

This study addresses the critical problem of identifying optimal business locations for small and medium enterprises (SMEs), a decision-making process by factors such as travel time uncertainty, natural disasters, and population density. Existing research in this area has not adequately addressed these complexities, leaving a knowledge gap that this study aims to fill. Our research employs two optimization methods, differential evolu­tion (DE) and mixed integer programming (MIP), to maximize customer coverage. We present a comprehensive model that not only determines optimum and near-optimum business locations but also investigates the scalability of the algorithms with increasing facilities and their adaptability to different traffic scenarios. Key findings indicate that the DE algorithm, in particular, demonstrates superior coverage performance. This study contributes to the field by providing a robust and adaptable model for facility location problem-solving. The insights gained have practical applications for both academia and industry, aiding SMEs in making informed, strategic decisions about business location placement.

Keywords

• coverage problem
• facility location
• metaheuristics
• optimization