A simulation-based algorithm for solving the Vehicle Routing Problem with Stochastic Demands

Abstract

This paper proposes a flexible solution methodology for solving the Vehicle Routing Problem with Stochastic Demands (VRPSD). The logic behind this methodology is to transform the issue of solving a given VRPSD instance into an issue of solving a small set of Capacitated Vehicle Routing Problem (CVRP) instances. Thus, our approach takes advantage of the fact that extremely efficient metaheuristics for the CVRP already exists. The CVRP instances are obtained from the original VRPSD instance by assigning different values to the level of safety stocks that routed vehicles must employ to deal with unexpected demands. The methodology also makes use of Monte Carlo Simulation (MCS) to obtain estimates of the expected costs associated with corrective routing actions (recourse actions) after a vehicle runs out of load before completing its route.