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Revenue maximizing assignment of products within a physical store layout by Integer Linear Programming

Kreuzberg, Joren (2019) Revenue maximizing assignment of products within a physical store layout by Integer Linear Programming.

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Abstract:This research aims to solve an adapted version of the general assignment problem. This assignment problem is the representation of finding a revenue maximizing assignment of products of a store to the physical locations within this store, where the assignment should satisfy additional feasibility require- ments that induce a store layout which is intuitive from a customers' point of view. The main focus in this intuitive store layout, is assigning products of the same kind to physical locations within the store that are in close proximity to each other. It appears that the adapted assignment problem with this requirement can be modelled as the maximum weight connected subgraph problem, which turns out to be NP-hard. This research consists of two parts. First the expected weekly revenue of every product on every physical location within the shop will be estimated by an intuitive statistical method using the available weekly sales data. These expected weekly revenues are used as input to determine the revenue maximizing assignment of the store. The second part is the main focus of this research and consists of a NP-hardness proof of the considered adapted assignment problem and an Integer Linear Program to find the revenue maximizing assignment of the store, including a penalty in the objective function in case there is no feasible solution possible
Item Type:Essay (Master)
Faculty:EEMCS: Electrical Engineering, Mathematics and Computer Science
Subject:31 mathematics
Programme:Applied Mathematics MSc (60348)
Link to this item:http://purl.utwente.nl/essays/77215
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