A Two-Stage Method to Optimize The Milk-Run System

Abstract

In this competitive manufacturing environment, material transportation is an important topic for researchers and practical applications.  This study presents a real life example of an automotive equipment manufacturer problem. The manufacturer has several depots to serve 54 milk-run suppliers and complained about the fluctuations of milk-run vehicles between work days and depots. The aim of this study is to develop a systematic approach to make milk-run system more stable for manufacturer. Therefore the systematic approach which consists of, the milk-run route optimization with mixed integer linear programming model, container loading heuristic to increase the utilization of milk-run vehicles and time interval assignment heuristic to avoid coincidence of milk-run vehicles at the depots, is suggested to get over existing problems of a manufacturer.