Multi-plant manufacturing assortment planning in the presence of transshipments

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buir.contributor.authorŞen, Alper
buir.contributor.orcidŞen, Alper|0000-0003-1728-6538
dc.citation.epage1050en_US
dc.citation.issueNumber3
dc.citation.spage1033
dc.citation.volumeNumber310
dc.contributor.authorDolgan, Nagihan Çömez
dc.contributor.authorDağ, Hilal
dc.contributor.authorÜnver, Nilgün Fescioğlu
dc.contributor.authorŞen, Alper
dc.date.accessioned2024-03-12T12:48:59Z
dc.date.available2024-03-12T12:48:59Z
dc.date.issued2023-05-31
dc.departmentDepartment of Industrial Engineering
dc.description.abstractIn this study, we consider the assortment planning problem of a manufacturing firm with multiple plants. Making a plant capable of producing a product is costly, therefore the firm cannot manufacture every product in every plant. In case a customer’s order in a particular region is not available in the closest plant, another plant can ship the product using transshipment, but at an extra transportation cost. If a demanded product is not produced in any plant, substitution from first choice to a second choice is also considered, which can be either satisfied by the closest plant, or by transshipment. The problem is to jointly determine assortments in all plants such that total profit after assortment and transshipment costs is maximized. The resulting problem is complex as transshipments and substitutions are intertwined to affect assortment decisions. We show that the optimal assortments are nested, i.e., the assortment of a plant with a smaller market share is a subset of the assortment of a plant with a larger share. The common assortment of all locations is shown to be in the popular set (i.e., no leapfrogging in product popularities), and a sufficient condition on substitution rate is derived for each individual assortment to be in the popular set. We conduct an extensive numerical study to understand the effects of allowing transshipments on resulting assortments. Moreover, we introduce approximate assortment planning algorithms that benefit from the derived structural properties, which are shown to generate near-optimal assortments in a broad range of instances tested.
dc.description.tableofcontentsProduction, manufacturing, transportation and logistics
dc.embargo.release2025-05-31
dc.identifier.doi10.1016/j.ejor.2023.03.026
dc.identifier.eissn1872-6860
dc.identifier.issn0377-2217
dc.identifier.urihttps://hdl.handle.net/11693/114609
dc.language.isoen
dc.publisherElsevier BV
dc.relation.isversionofhttps://doi.org/10.1016/j.ejor.2023.03.026
dc.rightsCC BY-NC-ND 4.0 DEED (Attribution-NonCommercial-NoDerivs 4.0 International)
dc.source.titleEuropean Journal of Operational Research
dc.subjectStrategic planning
dc.subjectAssortment planning
dc.subjectProduct variety
dc.subjectTransshipment
dc.subjectInventory sharing
dc.titleMulti-plant manufacturing assortment planning in the presence of transshipments
dc.typeArticle

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