Some Add-Drop and Drop-Add Interchange Heuristics for Non-Linear Warehouse Location

Some algorithms are described for solving plant location problems with non-linear warehousing costs. The heuristic procedures are flexible with respect to the type of warehousing cost structure permitted, and may be used to solve fixed p-median location problems as well as problems in which the numbers and locations of warehouses in solution are jointly determined as a trade-off between transportation and fixed and operating plant costs. Computational experience is reported on some well known problem sets in which the economies of scale in production are continuously concave. Comparisons with other solution methods indicate that the proposed procedures perform as well as, or better than any currently known on these standard tests problems.