Sequential Competitive Facility Location Problem in a Discrete Planar Space

In this paper, there are two competitors in a planar market. First competitor, that is called, leader, opens p new facilities. After that, second competitor, 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 demand is inelastic. Considering huff model, customers share their demand among all facilities, probabilistically. The leader’s objective function is maximization of its market share after follower’s new facilities entry. Leader and follower problems are solved via exact solution method.