Sequential Competitive Facility Location Problem in a Discrete Planar Space

Abstract In this paper, there are two competitors in a planar market. The first competitor, called, the leader, opens ?? new facilities. After that, the second competitor, the follower, reacts to the leader’s action and opens r new facilities. The leader and the follower have got some facilities in advance in this market. The optimal locations for leader and follower are chosen among predefined candidate locations. In this paper, it is assumed that the demand is inelastic. Considering the huff model, customers share their demand among all facilities, probabilistically. The leader’s objective function is the maximization of its market share after the follower’s new facilities entry. The leader and follower problems are solved via an exact solution method.