Quantum optimization beyond QUBO for industrial logistics and scheduling

The increasing complexity of industrial scheduling and transport routing problems motivates the study of alternative optimization formulations and computational paradigms. In this work, we study how higher-order unconstrained binary optimization (HUBO) formulations of such problems map onto quantum optimization workflows in both noisy and fault-tolerant regimes. We consider three representative logistics and manufacturing use cases and formulate each as a HUBO problem. This captures process intricacies, such as highly correlated assembly-line scheduling rules, which are difficult to express faithfully with the standard quadratic (QUBO) form, while at the same time reducing the number of binary variables required in the quantum mapping, thus lowering qubit demand. We compare the HUBO formulations with corresponding QUBO encodings, highlighting a key trade-off: while HUBO reduces qubit requirements through compact binary encoding, it introduces higher-order interaction terms that increase circuit depth, limiting feasibility on current quantum hardware. The proposed formulations are validated using classical solvers across several problem instances and benchmark small routing problem instances using bias-field digitized counterdiabatic quantum optimization in classical simulation. We complement these results with a resource and scalability analysis, focusing on the capacitated vehicle routing problem as a representative large-scale industrial use case. Our analysis indicates that while HUBO formulations offer advantages in qubit scaling compared to QUBO encodings, their practical implementation is constrained by gate fidelity, coherence, and circuit depth, making hybrid quantum-classical workflows and early fault-tolerant quantum hardware the most plausible settings for their practical use.