A Three-Stage Algorithm for the Large Scale Dynamic Vehicle Routing Problem with an Industry 4.0 Approach

Industry 4.0 is a concept which helps companies to have a smart supply chain system when they are faced with a dynamic process. As Industry 4.0 focuses on mobility and real-time integration, it is a good framework for a Dynamic Vehicle Routing problem (DVRP). The main objective of this research is to solve the DVRP on a large-scale size. The aim of this study is to show that the delivery vehicles must serve customer demands from a common depot to have a minimum transit cost without exceeding the capacity constraint of each vehicle. In VRP, to reach an exact solution is quite difficult, and in large-size real world problems it is often impossible. Also, the computational time complexity of this type of problem grows exponentially. In order to find optimal answers for this problem in medium and large dimensions, using a heuristic approach is recommended as the best approach. A hierarchical approach consisting of three stages as cluster-first, route-construction second, route-improvement third is proposed. In the first stage, customers are clustered based on the number of vehicles with different clustering algorithms (i.e., K-mean, GMM, and BIRCH algorithms). In the second stage, the DVRP is solved using construction algorithms and in the third stage improvement algorithms are applied. The second stage is solved using construction algorithms (i.e. Savings algorithm, path cheapest arc algorithm, etc.). In the third stage, improvement algorithms such as Guided Local Search, Simulated Annealing and Tabu Search are applied. One of the main contributions of this paper is that the proposed approach can deal with large-size real world problems to decrease the computational time complexity. The results of this approach confirmed that the proposed methodology is applicable.