On solving the multi-period single-sourcing problem under uncertainty

Abstract.

We present a framework for solving the strategic problem of assigning retailers to facilities in a multi-period single-sourcing product environment under uncertainty in the demand from the retailers and the cost of production, inventory holding, backlogging and distribution of the product. By considering a splitting variable mathematical representation of the Deterministic Equivalent Model, we specialize the so-called Branch-and-Fix Coordination algorithmic framework. It exploits the structure of the model and, specifically, the non-anticipativity constraints for the assignment variables. The algorithm uses the Twin Node Family (TNF) concept. Our procedure is specifically designed for coordinating the selection of the branching TNF and the branching S3 set, such that the non-anticipativity constraints are satisfied. Some computational experience is reported.