Solving an Inventory Routing Problem in Supply Chain by DC Programming and DCA

Inventory routing problem (IRP) has received growing attention from both researchers and supply chain planners. It can be formulated as a mixed 0-1 nonlinear programming problem that is difficult to solve. We propose a new approach based on DC (Difference of Convex Functions) programming and DCA (DC Algorithm) for solving this challenging problem. Using an exact penalty technique and a decomposition technique, the original problem is transformed into an equivalent DC problem. DCA applied on the resulting problem gives the promising results.