Stochastic and dynamic vehicle routing with general demand and interarrival time distributions

Abstract

We analyze a class of stochastic and dynamic vehicle routing problems in which demands arrive randomly over time and the objective is minimizing waiting time. In our previous work ([6], [7]), we analyzed this problem for the case of uniformly distributed demand locations and Poisson arrivals. In this paper, using quite different techniques, we are able to extend our results to the more realistic case where demand locations have an arbitrary continuous distribution and arrivals follow only a general renewal process. Further, we improve significantly the best known lower bounds for this class of problems and construct policies that are provably within a small constant factor relative to the optimal solution. We show that the leading behavior of the optimal system time has a particularly simple form that offers important structural insight into the behavior of the system. Moreover, by distinguishing two classes of policies our analysis shows an interesting dependence of the system performance on the demand distribution.