A Pseudo-Parallel Genetic Algorithm Integrating Simulated Annealing for Stochastic Location-Inventory-Routing Problem with Consideration of Returns in E-Commerce

Abstract

Facility location, inventory control, and vehicle routes scheduling are three key issues to be settled in the design of logistics system for e-commerce. Due to the online shopping features of e-commerce, customer returns are becoming much more than traditional commerce. This paper studies a three-phase supply chain distribution system consisting of one supplier, a set of retailers, and a single type of product with continuous review (Q, r) inventory policy. We formulate a stochastic location-inventory-routing problem (LIRP) model with no quality defects returns. To solve the NP-hand problem, a pseudo-parallel genetic algorithm integrating simulated annealing (PPGASA) is proposed. The computational results show that PPGASA outperforms GA on optimal solution, computing time, and computing stability.