A branch-and-bound algorithm for solving fixed charge problems

Numerous procedures have been suggested for solving fixed charge problems. Among these are branch-and-bound methods, cutting plane methods, and vertex ranking methods. In all of these previous approaches, the procedure depends heavily on the continuous costs to terminate the search for the optimal solution. In this paper, we present a new branch-and-bound algorithm that calculates bounds separately on the sum of fixed costs and on the continuous objective value. Computational experience is shown for various standard test problems as well as for randomly generated problems. These test results are compared to previous procedures as well as to a mixed integer code. These comparisons appear promising.