Integer Linear Programming Model for Profit Maximization using Branch and Bound Algorithm in Retail Companies: Case of a Peruvian Company

Chancahuana Castillo J.D.; Parisuana Yucra W.N.; Soto M.N.; Ynfantes S.C. · Procedia Computer Science (2024) · DOI: 10.1016/j.procs.2024.06.134

Resumen

This article presents an inventory management model for profit maximization in a Peruvian retail company (FIDEL) using linear programming techniques and the Branch and Bound algorithm. To introduce this paper we refute, through a review of previous studies in the same field, the use of this approach for its effectiveness in business decision-making. Gathering data on costs, demand and the available capital for the company's different product lines was done through the use of interviews. The proposed model aims to maximize revenue based on the quantities of goods purchased, while considering minimum demand and capital constraints. Validation was performed with Lingo software to confirm the consistency and feasibility of the model. The resulting values revealed a significant increase in projected profits compared to actual data.

Instituciones: Universidad Nacional Mayor de San Marcos; Universidad Privada del Norte