Location-inventory-routing Problem in a Context of City Logistics: A Case Study of Jakarta

Author(s):

  • Nova Saragih1 (Telkom University, Bandung, Indonesia)
  • Senator Nur Bahagia1 (Bandung Institute of Technology, Bandung, Indonesia)
  • Suprayogi Suprayogi1 (Bandung Institute of Technology, Bandung, Indonesia)
  • Ibnu Syabri1 (Bandung Institute of Technology, Bandung, Indonesia)

Abstract:
City logistics idea is to develop an effective, efficient, and environmentally friendly logistics system. The development of city logistics is related to energy consumption, traffic congestion, economic and environmental problems. As one of the megacities in the world, Jakarta faces an inventory problem which is low availability of only 76%. Jakarta also faces the problem of transportation that is traffic congestion. The problems show that it is needed to develop city logistics in Jakarta. City logistics developed in this paper is related to decisions of location, inventory, and routing problems or LIRP (location-inventory-routing problem) in short. The LIRP takes into account multi-products, multi suppliers, and traffic congestion as an external parameters. This paper aims to develop a heuristic method to solve the LIRP. The heuristic method is based on simulated annealing (SA) algorithm. Existing literature shows that this paper's heuristic method to solve the LIRP has never been developed before. From applying the heuristic method in Jakarta, the coordination concept of city logistics reduces the vehicle number by 73%, and the consolidation concept of city logistics increases the availability from 76% to 95%.

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