Local improvement in planar facility location using vehicle routing

In physical distribution the location of depots and vehicle routes are interdependent problems, but they are usually treated independently. Location-routing is the study of solving locational problems such that routing considerations are taken into account. We present an iterative heuristic for the location-routing problem on the plane. For each depot the Weber problem is solved using the end-points of the routes found previously as input nodes to the Weiszfeld procedure. Although the improvements found are usually small they show that it pays not to ignore the routing aspects when solving continuous location problems. Possible research avenues in continuous location-routing will also be suggested.