P. Fernández Hernández, A. Lancinskas, B. Pelegrín Pelegrín, J. Zilinskas

An entering firm wants to compete for market share in a geographical area by opening a few new facilities selected from a finite set of potential locations (discrete space). Customers are spatially separated, with fixed demand, and there are already other firms operating in that area, but they will be considered as a single competitor.
For customer behavior, the proportional and binary customer choice rules are considered but sequentially, that is, the proportional rule (the main rule) is applied first to all customers for which there are facilities with a minimum attraction threshold established by each of them, and binary rule (the secondary rule) is applied for customers to whom the proportional rule cannot be applied.
The first formulation is proposed as a non-linear binary programming problem and a heuristic procedure is applied to approximate the optimal solution for medium-sized problem using real geographic coordinates and population data from the municipalities of Spain.

Keywords: Competitive Location, sequential customer choice rules

Scheduled

GT01 Localización I Discrete Location
June 8, 2022  4:00 PM
A15


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