Mathematical modelling of a transport system with minimal maintenance costs

We suggest a mathematical model of a transport system. The model describes the delivery of products from several suppliers to different points of consumption. It is assumed that consumer demands are random. The model is a two-stage stochastic programming problem. At the first stage suppliers make the commodity stocks. At the second stage we consider the product distribution to the points of consumption while minimizing compensation expenses for the goods shortage caused by the random demand. The model takes into account a random loss that occurs during the transportation of goods and the detection of defective products. The total cost of the transport system operation is minimized. The algorithm for solving the problem is proposed. This algorithm is based on reduction of the original problem to an equivalent mixed-integer linear programming problem after discretization. An example is considered.