Study On The Vehicle Routing And The Allocation Of The Saving Costs Of Manufacturers

It has been a consensus that effective supply chain management can improve the competition capabilities of enterprises in the world, especially under the background of today's world financial crisis. The application of the theory of Milk Run can not only reduce the logistics cost, but also reduce the whole supply chain cost and enhance the competition capability of the firms.During the past decades, the main channel of reducing cost is production planning such as supply chain and logistics management. The success of the idea of Milk Run in developed countries drew the attentions of Chinese scholars and firms. To make out the optimal vehicle routing and the proper allocation of the saving costs is the key to the success of the implementation of the idea of Milk Run. In this paper, the models of the optimal vehicle routing and the proper allocation of the saving costs have been built based on the fully analysis of the idea of Milk Run and its applying conditions. The simulated annealing algorithm and the Shapley algorithm have been developed for vehicle routing and saving costs allocation respectively. The models and the algorithms have been used to solve the relevant problems of T Company according to its actual situations. By doing so, the accuracy and feasibility of the idea of Milk Run were verified.The idea of Milk Run can benefit the enterprise and enhance the competition ability of the firms. Therefore, the Milk Run management will get more extensive and in-depth studies in the future.