Tabu Search Heuristic for a Two- Echelon Location-Routing Problem

In this paper we tackle a two-echelon location-routing problem (2E-LRP) by a tabu search metaheuristic. The aim is to define the location and number of two kinds of capacitated facilities, the size of two different vehicle fleets and the related routes on each echelon. The proposed Tabu Search (TS) for the 2E-LRP is based on the decomposition of the problem in two location-routing sub-problems, one for each echelon. Then each subproblem is decomposed into a capacitated facility location problem (CFLP) and a multidepot vehicle routing problem (MDVRP). The heuristic uses an iterative-nested approach to combine the solutions of the four subproblems. TS has been experienced on a wide set of small, medium and large instances and the obtained results have been compared with the ones of 2E-LRP models on small size instances and with upper bounds, obtained with a simple sequential approach, on medium and large size instances. Experimental results prove that proposed TS is effective in terms of quality of solutions and computation times in most of the solved instances.