An optimization modeling for customer redistribution and its spreadsheet implementation

Abstract

This paper proposes a mathematical optimization formulation for the problem of redistribution. Customer redistribution to remaining branches arises from closing or merging of branches in a service region. Redistribution model requires different treatment from allocation model as the former reflects the perception of service performance by the individual customers, who are the perpetual decision makers. It is shown in this work that redistribution is amenable to analysis in the form of a non-linear mathematical program, which possesses special structures that can be fully exploited to give solutions from an iterative implementation on a spreadsheet. © 1995.