n this research, we extended the existing models in supply chain network design, specialized in the model proposed by Duong and Bui (2014). We succeeded in developing a model for capacitated facility location problem, in which, outsourcing strategy and direct shipments are considered. This model suggests that the investors can open enough facilities to meet demand so thattotal fixed costs and investment risks are reduced. Thus, we employed a dummy distribution centers (dummy DCs) to link from

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... nufacturing plants to retailers. We assumed dummy DCs capacities as vehicles capacity (truck load). The advantage of this model is that we can control the number of vehicles requirement at each period. Moreover, our proposed model can modified for outsourcing strategy by changing manufacturing plant sources to supplier sources. This makes a difference between our model and the existing ones. For validation testing, we compared our solutions to the solutions obtained by the proposed model of Duong and Bui, 2014 with the same input parameters