A stochastic optimization model for designing last mile relief networks

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Official URL: http://dx.doi.org/10.1287/trsc.2015.0621

In this study, we introduce a distribution network design problem that determines the locations and capacities of the relief distribution points in the last mile network, while considering demand- and network-related uncertainties in the post-disaster environment. The problem addresses the critical concerns of relief organizations in designing last mile networks, which are providing accessible and equitable service to beneficiaries. We focus on two types of supply allocation policies and propose a hybrid version considering their different implications on equity and accessibility. Then, we develop a two-stage stochastic programming model that incorporates the hybrid allocation policy and achieves high levels of accessibility and equity simultaneously. We devise a branch-and-cut algorithm based on Benders decomposition to solve large problem instances in reasonable times and conduct a numerical study to demonstrate the computational effectiveness of the solution method. We also illustrate the application of our model on a case study developed based on the real-world data from the 2011 Van earthquake in Turkey.