Capacity expansion problem of multisite batch plants with production and distribution

Abstract

In this study we develop a capacity expansion model of an integrated production and distribution system comprised of multisite batch plants and several warehouses. Such an integration of the production and distribution system can generate significant savings by trading off the costs associated with the whole, rather than minimizing production and distribution costs separately. The study presented here to be considered as two or more multiproduct batch plants producing several products to supply several warehouses. An objective function is defined as a net profit in a chemical company - total expected selling price minus the cost of new units and the expected shipping cost. We determine a revised plant configuration. sizes and operating modes of newly added units, new shipments from plant to warehouse and batch processing variables. The effectiveness of its application is illustrated with two case studies. The case studies are solved with GAMS/DICOPT + +. (C) 2000 Elsevier Science Ltd. All rights reserved.