Sensitivity Analysis and Greedy Heuristic Approach to Transshipment Model in Outbound System
Managing outbound supply of manufacturing products in a multi-echelon systems is noticeably more complex than managing them in a single-echelon system. Unfortunately, engineering managers rely on local heuristics while making allocation decision. Rule of thumb strategies does not guarantee optimal solution. In this study, an algorithm for effective transshipment has been developed. The model was tested using information from a bottling plant in Nigeria. It was observed that the source distribute products to downstream location at a high cost, not meeting the demand at required outbound neighbourhood. At the end of the analysis, the results obtained showed that the developed model eliminated several deficiencies since all depots got a fraction of the products demanded at all destinations in a cost effective manner. It is concluded that the model is effective for reducing or minimizing distribution expenses while fulfilling demand at all destinations.
Keywords - Single-Echelon, Multi-Echelon, Heuristics, Algorithm, Transshipment