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This paper presents a solution methodology for the heterogeneous fleet vehicle routing problem with time windows. The objective is to minimize the total distribution costs, or similarly to determine the optimal fleet size and mix that minimizes both the total distance travelled by vehicles and the fixed vehicle costs, such that all problem's constraints are satisfied. The problem is solved using a two-phase solution framework based upon a hybridized Tabu Search, within a new Reactive Variable Neighborhood Search metaheuristic algorithm. Computational experiments on benchmark data sets yield high quality solutions, illustrating the effectiveness of the approach and its applicability to realistic routing problems.

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