A new model for supply chain network design with integrated assembly line balancing decisions

Supply chain network design aims at the integration of the different actors of a supply chain within a single framework in order to optimise the total profit of the system. In this paper, we consider the integration of line balancing issues within the tactical decisions of the supply chain, and we offer a novel model and a solution approach for the problem. The new approach decomposes the problem into multiple line balancing problems and a mixed integer linear model, which is easier to solve than the previously available non-linear mixed integer formulation. The results show that the new method is able to solve previously studied models within a fraction of the reported running times, and also allows us to solve larger instances than those reported in earlier works. Finally, we also provide some analysis on the influence of the cost structure, the demand and the structure of the assembly process on the final configuration of the assemblies and the distribution network.