Optimizing the wine transportation process from bottling plants to ports

Abstract

The wine industry is a highly competitive sector for which any efficiency improvement in the wine supply chain plays a critical role in maintaining or increasing profitability. Literature shows several successful applications of operational research tools at each stage of the wine production process. However, unlike other stages, the transportation and distribution phase has not been given the same attention in the specialized literature. To bridge this gap, this article proposes an integer linear programming model to jointly determine a plan for the bottling and transportation of products to ports in order to minimize inventory, freight, and delay costs. This model can be optimally solved in less than one day for small instances of up to 25 jobs. In practice, however, some industrial instances can easily exceed 200 jobs, which precludes the use of this model to support decision-making. To cope with this issue, we devise a two-stage procedure that generates good-quality solutions for industrial-size instances of this problem in reasonable computing times. Particularly, we show that the GAP of the proposed heuristic solution is relatively low for a wide range of instances. Finally, a case study is conducted on a medium-sized Chilean winery we worked with, where the planning generated by the proposed heuristic reduces the costs corresponding to the transportation stage by 45.3% in the best case, compared to the initial planning of the winery.