Network hub location problems: The state of the art

Hubs are special facilities that serve as switching, transshipment and sorting points in many-to-many distribution systems. The hub location problem is concerned with locating hub facilities and allocating demand nodes to hubs in order to route the traffic between origin–destination pairs. In this paper we classify and survey network hub location models. We also include some recent trends on hub location and provide a synthesis of the literature.     

A hub covering network design problem for cargo applications in Turkey

Hub location problems involve locating hub facilities and allocating demand nodes to hubs in order to provide service between origin–destination pairs. In this study, we focus on cargo applications of the hub location problem. Through observations from the Turkish cargo sector, we propose a new mathematical model for the hub location problem that relaxes the complete hub network assumption. Our model minimizes the cost of establishing hubs and hub links, while designing a network that services each origin–destination pair within a time bound. We formulate a single-allocation hub covering model that permits visiting at most three hubs on a route. The model is then applied to the realistic instances of the Turkish network and to the Civil Aeronautics Board data set.     

The hub location and network design problem with fixed and variable arc costs: formulation and dual-based solution heuristic

Many air, less-than-truck load and intermodal transportation and telecommunication networks incorporate hubs in an effort to reduce total cost. These hubs function as make bulk/break bulk or consolidation/deconsolidation centres. In this paper, a new hub location and network design formulation is presented that considers the fixed costs of establishing the hubs and the arcs in the network, and the variable costs associated with the demands on the arcs. The problem is formulated as a mixed integer programming problem embedding a multi-commodity flow model. The formulation can be transformed into some previously modelled hub network design problems. We develop a dual-based heuristic that exploits the multi-commodity flow problem structure embedded in the formulation. The test results indicate that the heuristic is an effective way to solve this computationally complex problem.     

A biased random-key genetic algorithm for the tree of hubs location problem

Hubs are facilities used to treat and dispatch resources in a transportation network. The objective of Hub Location Problems (HLP) is to locate a set of hubs in a network and route resources from origins to destinations such that the total cost of attending all demands is minimized. In this paper, we investigate a particular HLP, called the Tree of Hubs Location Problem in which hubs are connected by means of a tree and the overall network infrastructure relies on a spanning tree. This problem is particularly interesting when the total cost of building the hub backbone is high. We propose a biased random key genetic algorithm for solving the tree of hubs location problem. Computational results show that the proposed heuristic is robust and effective to this problem. The method was able to improve best known solutions of two benchmark instances used in the experiments.     

Modeling fuzzy capacitated p-hub center problem and a genetic algorithm solution

Hub and spoke networks are used to switch and transfer commodities between terminal nodes in distribution systems at minimum cost and/or time. The p-hub center allocation problem is to minimize maximum travel time in networks by locating p hubs from a set of candidate hub locations and allocating demand and supply nodes to hubs. The capacities of the hubs are given. In previous studies, authors usually considered only quantitative parameters such as cost and time to find the optimum location. But it seems not to be sufficient and often the critical role of qualitative parameters like quality of service, zone traffic, environmental issues, capability for development in the future and etc. that are critical for decision makers (DMs), have not been incorporated into models. In many real world situations qualitative parameters are as much important as quantitative ones. We present a hybrid approach to the p-hub center problem in which the location of hub facilities is determined by both parameters simultaneously. Dealing with qualitative and uncertain data, Fuzzy systems are used to cope with these conditions and they are used as the basis of this work. We use fuzzy VIKOR to model a hybrid solution to the hub location problem. Results are used by a genetic algorithm solution to successfully solve a number of problem instances. Furthermore, this method can be used to take into account more desired quantitative variables other than cost and time, like future market and potential customers easily.     

The Tree of Hubs Location Problem

This paper presents the Tree of Hubs Location Problem. It is a network hub location problem with single assignment where a fixed number of hubs have to be located, with the particularity that it is required that the hubs are connected by means of a tree. The problem combines several aspects of location, network design and routing problems. Potential applications appear in telecommunications and transportation systems, when set-up costs for links between hubs are so high that full interconnection between hub nodes is prohibitive. We propose an integer programming formulation for the problem. Furthermore, we present some families of valid inequalities that reinforce the formulation and we give an exact separation procedure for them. Finally, we present computational results using the well-known AP and CAB data sets.     

Proprietor and customer costs in the incomplete hub location-routing network topology

The hub location problem finds the location of hubs and allocates the other nodes to them. It is widely supposed the network created with the hub nodes is complete in the extensive literature. Relaxation of this basic supposition forms the present work. The model minimizes the cost of the proprietor, including the fixed costs of hubs, hub links and spoke links. Costs of hub and spoke links are contemplated as fixed cost or maintenance cost. Moreover, the model considers routing costs of customers who want to travel from origins to destinations. In this study, we offer a model to the multiple allocations of the hub location problems, under the incomplete hub location-routing network design. This model is easily transformed to other hub location problems using one or more constraints. No network format is dictated on the hub network. We suggest a set of valid inequalities for the formulation. Some lower bounds are developed using a Lagrangian relaxation approach and the valid inequalities. Computational analyses evaluate the performances of the lower bounding implementations and valid inequalities. Furthermore, we explore the effects of several factors on the design and solution time of the problem formulation.     

General network design: A unified view of combined location and network design problems

This paper presents a unified framework for the general network design problem which encompasses several classical problems involving combined location and network design decisions. In some of these problems the service demand relates users and facilities, whereas in other cases the service demand relates pairs of users between them, and facilities are used to consolidate and re-route flows between users. Problems of this type arise in the design of transportation and telecommunication systems and include well-known problems such as location-network design problems, hub location problems, extensive facility location problems, tree-star location problems and cycle-star location problems, among others. Relevant modeling aspects, alternative formulations and possible algorithmic strategies are presented and analyzed.     

The planar hub location problem: a probabilistic clustering approach

Given the demand between each origin-destination pair on a network, the planar hub location problem is to locate the multiple hubs anywhere on the plane and to assign the traffic to them so as to minimize the total travelling cost. The trips between any two points can be nonstop (no hubs used) or started by visiting any of the hubs. The travel cost between hubs is discounted with a factor. It is assumed that each point can be served by multiple hubs. We propose a probabilistic clustering method for the planar hub-location problem which is analogous to the method of Iyigun and Ben-Israel (in Operations Research Letters 38, 207–214, 2010; Computational Optmization and Applications, 2013) for the solution of the multi-facility location problem. The proposed method is an iterative probabilistic approach assuming that all trips can be taken with probabilities that depend on the travel costs based on the hub locations. Each hub location is the convex combination of all data points and other hubs. The probabilities are updated at each iteration together with the hub locations. Computations stop when the hub locations stop moving. Fermat-Weber problem and multi-facility location problem are the special cases of the proposed approach.     

基于线路“异质性”假设的轴辐式公共交通网络优化研究

特大城市公共交通局部静态拥堵问题日益成为制约公共交通网络运行效率提高的关键。针对这一问题改变线路“同质性”假设,在线路“异质性”假设的基础上,提出了将轴辐式网络设计运用到公共交通领域中来,综合考虑居民采用公共交通方式出行的单位运输可变成本、不变成本、枢纽换乘成本等要素,将枢纽间大型客车干线运输所带来的规模经济效应进行量化,构建了基于单分配、多枢纽、混合式网络结构特征的轴辐式公共交通网络优化模型,旨在多重约束下通过枢纽布局降低网络运输成本,提高公共交通网络站点的可达性。最后根据模拟退火算法对模型进行求解,并通过算例分析与讨论的方式验证了模型的有效性。     

Modeling congestion and service time in hub location problems

In this paper, we present a modeling framework for hub location problems with a service time limit considering congestion at hubs. Service time is modeled taking the traveling time on the hub network as well as the handling time and the delay caused by congestion at hubs into account. We develop mixed-integer linear programming formulations for the single and multiple allocation versions of this problem. We further extend the multiple allocation model with a possibility of direct shipments. We test our models on the well-known AP data set and analyze the effects of congestion and service time on costs and hub network design. We introduce a measure for the value of modeling congestion and show that not considering the effects of congestion may result in increased costs as well as in building infeasible hub networks.     

Location of hubs in a competitive environment

We offer a formulation that locates hubs on a network in a competitive environment; that is, customer capture is sought, which happens whenever the location of a new hub results in a reduction of the current cost (time, distance) needed by the traffic that goes from the specified origin to the specified destination. The formulation presented here reduces the number of variables and constraints as compared to existing covering models. This model is suited for both air passenger and cargo transportation. In this model, each origin–destination flow can go through either one or two hubs, and each demand point can be assigned to more than a hub, depending on the different destinations of its traffic. Links (“spokes”) have no capacity limit. Computational experience is provided.     

Hub and spoke network design with single-assignment,capacity decisions and balancing requirements

In this paper, an extension of the capacitated single-allocation hub location problem is considered in which the capacity of the hubs is part of the decision making process and balancing requirements are imposed on the network. The decisions to be made comprise (i) the selection of the hubs, (ii) the allocation of the spoke nodes to the hubs, (iii) the flow distribution through the sub network defined by the hubs and (iv) the capacity level at which each hub should operate. In the latter case, for each potential hub, a set of available capacities is considered among which one can be chosen. The objective is to minimize the total cost, which includes the setup cost for the hubs as well as the flow routing cost. Economies of scale are assumed for the costs. Balancing requirements are imposed to the network. In particular, a value is considered for the maximum difference between the maximum and minimum number of spoke nodes that are allocated to the hubs. Two mixed-integer linear programming formulations are proposed and analyzed for this problem. The results of a set of computational experiments using an off-the-shelf commercial solver are presented. These tests aim at evaluate the possibility of solving the problem to optimality using such a solver with a particular emphasis to the impact of the balancing requirements. The tests also allow an analysis of the gap of the bounds provided by linear relaxation.     

Design of intermodal logistics networks with hub delays

In an intermodal hub network, cost benefits can be achieved through the use of intermodal shipments and the economies of scale due to consolidation of flows at the hubs. However, due to limited resources at the logistics hubs, shipment delays may affect the service performance. In this research hub operations are modeled as a GI/G/1 queuing network and the shipments as multiple job classes with deterministic routings. By integrating the hub operation queuing model and the hub location-allocation model, the effect of limited hub resources on the design of intermodal logistics networks under service time requirements is investigated. The managerial insights gained from a study of 25-city road-rail intermodal logistics network show that the level of available hub resources significantly affects the logistics network structure in terms of number and location of hubs, total network costs, choice of single-hub and inter-hub shipments and service performance.     

A capacitated hub location problem in freight logistics multimodal networks

In this paper we deal with a capacitated hub location problem arising in a freight logistics context; in particular, we have the need of locating logistics platforms for containers travelling via road and rail. The problem is modelled on a weighed multimodal network. We give a mixed integer linear programming model for the problem, having the goal of minimizing the location and shipping costs. The proposed formulation presents some novel features for modelling capacity bounds that are given both for the candidate hub nodes and the arcs incident to them; further, the containerised origin-destination (\(o-d)\) demand can be split among several platforms and different travelling modes. Note that here the network is not fully connected and only one hub for each \(o-d\) pair is used, serving both to consolidate consignments on less transport connections and as reloading point for a modal change. Results of an extensive computational experimentation performed with randomly generated instances of different size and capacity values are reported. In the test bed designed to validate the proposed model all the instances up to 135 nodes and 20 candidate hubs are optimally solved in few seconds by the commercial solver CPLEX 12.5.     

A competitive hub location and pricing problem

We formulate and solve a new hub location and pricing problem, describing a situation in which an existing transportation company operates a hub and spoke network, and a new company wants to enter into the same market, using an incomplete hub and spoke network. The entrant maximizes its profit by choosing the best hub locations and network topology and applying optimal pricing, considering that the existing company applies mill pricing. Customers’ behavior is modeled using a logit discrete choice model. We solve instances derived from the CAB dataset using a genetic algorithm and a closed expression for the optimal pricing. Our model confirms that, in competitive settings, seeking the largest market share is dominated by profit maximization. We also describe some conditions under which it is not convenient for the entrant to enter the market.     

A branch and cut algorithm for hub location problems with single assignment

The hub location problem with single assignment is the problem of locating hubs and assigning the terminal nodes to hubs in order to minimize the cost of hub installation and the cost of routing the traffic in the network. There may also be capacity restrictions on the amount of traffic that can transit by hubs. The aim of this paper is to investigate polyhedral properties of these problems and to develop a branch and cut algorithm based on these results.Acknowledgement The research of the first author was partially supported by the Banque Nationale de Belgique. The research of the second author was supported by France Telecom R&D under contract no. 99 1B 774. Their support is gratefully acknowledged.     

Dynamic evolution of economically preferred facilities

In a sustained development scenario, it is often the case that an investment is to be made over time in facilities that generate benefits. The benefits result from joint synergies between the facilities expressed as positive utilities specific to some subsets of facilities. As incremental budgets to finance fixed facility costs become available over time, additional facilities can be opened. The question is which facilities should be opened in order to guarantee that the overall benefit return over time is on the highest possible trajectory. This problem is common in situations such as ramping up a communication or transportation network where the facilities are hubs or service stations, or when introducing new technologies such as alternative fuels for cars and the facilities are fueling stations, or when expanding the production capacity with new machines, or when facilities are functions in a developing organization that is forced to make choices of where to invest limited funding.     

A new formulation and an exact approach for the many-to-many hub location-routing problem

An important problem of the freight industry is the parcel delivery network design, where several facilities are responsible for assembling flows from several origins, re-routing them to other facilities where the flows are disassembled and the packages delivered to their final destinations. In order to provide this service, local tours are established for the vehicles assigned to each of the processing facilities, which are then responsible for the pickup and delivery tasks. This application gives rise to the many-to-many hub location routing problem that is the combination of two well known problems: the vehicle routing problem and the single assignment hub location problem. In this work, a new formulation for this important problem is proposed and solved by a specially tailored Benders decomposition algorithm. The proposed method is robust enough to solve instances up to 100 nodes having 4 million integer variables.     

航线联盟下航空货运网络枢纽点选址问题研究

本文研究航空联盟下航空货运网络的枢纽点选址问题(HLP),基于枢纽点的数量及位置随机与容量的限制。首先引入航线联盟选择概率函数,确定不同航段上的航线自营运输或外包运输的概率;其次根据选址中心法则,以网络总成本最小化为目标,建立枢纽点选址模型;再次采用改进的免疫混沌遗传算法求解模型;最后,以顺丰航空公司案例进行实例分析。结果表明:1)本文改进的算法较免疫混沌遗传算法并与免疫遗传算法及CPLEX结果对比,发现本文设计的算法有较强的收敛性和计算速度,且计算结果与CPLEX求解器求解结果相差不大;2)枢纽点数量不确定时,枢纽点的位置多集中在东部城市;3)航空公司选择联盟环境可以大大降低运营成本,航空公司为提高自身利润,应考虑加入联盟,从而降低自身成本。