Solving the location-routing problem with simultaneous pickup and delivery by simulated annealing

The study concerns the location-routing problem with simultaneous pickup and delivery (LRPSPD) in which the pickup and delivery take place at the same time for each customer. The goal is to determine the facility locations and vehicle routes in order to minimise the total system cost as a sum of facility opening cost, vehicle fixed cost and vehicle travel cost. A simulated annealing (SA) heuristic is proposed for the problem and extensive computational experiments are conducted. The results show that the proposed SA effectively solves LRPSPD and outperforms existing exact approaches in terms of solution quality.