MIP Neighborhood Search Heuristics for a Capacitated Fixed-Charge Network Design Problem

The fixed-charge capacitated multicommodity network design problem is a fundamental optimization problem arising in many network configurations. The solution of the problem provides an appropriate network design as well as routes of multicommodity flows aimed at minimizing the total cost, which is the sum of the flow costs and fixed-charge costs over a network with limited arc capacities. In the present paper, we introduce a combined approach with a capacity scaling procedure for finding an initial feasible solution and an MIP neighborhood search for improving the solutions. Besides, we modify the procedure for application to large-scale problems. Computational experiments demonstrate the effectiveness of the proposed approach, and high-quality solutions are obtained for two problem sets from the literature.