Solution algorithms for the capacitated single allocation hub location problem

In this paper, we present an efficient approach for solving capacitated single allocationhub location problems. We use a modified version of a previous mixed integer linearprogramming formulation developed by us for p‐hub median problems. This formulationrequires fewer variables and constraints than those traditionally used in the literature. Wedevelop good heuristic algorithms for its solution based on simulated annealing (SA) andrandom descent (RDH). We use the upper bound to develop an LP‐based branch and boundsolution method. The problem, as we define it, finds applications in the design of postaldelivery networks, particularly in the location of capacitated mail sorting and distributioncentres. We test our algorithms on data obtained from this application. To the best of ourknowledge, this problem has not been solved in the literature. Computational results arepresented indicating the usefulness of our approach.