Profit Optimization for a Manufacturing Supply Chain Under Carbon Emission and with Inventory - Price Based Demand (original) (raw)

Low Carbon Economic Production Quantity Model for Imperfect Quality Deteriorating Items

International Journal of Industrial Engineering and Engineering Management

This paper presents an economic production quantity (EPQ) model for deteriorating items with a certain percentage of defective products due to an imperfect process. The defective products are sold to a secondary market at a discount price. Due to environmental concern and carbon tax regulation, the manufacturer incorporates the control of carbon emission cost into its decision model. Carbon emission cost is a function of electricity consumption during production and inventory storage; it is also dependent on the carbon tax rate. Since the production process results in work-in-process inventory and carbon emission, the study tries to optimize the throughput time. We also examine the effect of carbon tax regulation on the potential emission reduction from the developed deteriorating item model. A numerical example and sensitivity analysis have been provided, and the result confirms the influence of carbon tax regulation in reducing carbon emission.

A Sustainable Inventory Model with Imperfect Products, Deterioration, and Controllable Emissions

Mathematics, 2020

Maintaining product quality and environmental performance are emerging concerns in modern competitive and transparent businesses. Many retailers separate perfect products from imperfect ones to ensure product quality and endeavor to achieve carbon dioxide (CO2) reduction through green technology investments and sustainable inventory planning. Product deterioration often badly hampers the retailing business; hence, suitable preservation technologies are used. In this study, we examined the optimization model of the selling price, investment, and replenishment planning to maximize the total profit. The proposed model considered the effect of a greater deterioration rate and discount price of imperfect products. Due to the high uncertainty in demand, a realistic holding cost was deliberated with a variable and constant part. Every time the retailer transports purchased items, greenhouse gases (GHGs), including CO2, are produced. Government regulations on CO2 minimization and customer a...

Vendor-managed inventory (VMI) deteriorating item model taking into account carbon emissions

Scientia Iranica

This research investigates the primary actions that generate carbon supply chain emission generated by the transport of deteriorating products. This study applies a vendormanaged inventory (VMI) model that considers deteriorating items with a single-setupsingle-delivery (SSSD) system, and also a single-setup-multiple-delivery (SSMD) system. This study's managerial insights can help both researchers and businesses make inventory management decisions that reduce the total cost of processing these deteriorating commodities, as well as the total cost of carbon emissions. A numerical example optimizing the order quantity and order frequency for each manufacturing cycle is shown. Findings from this research can assist businesses in discovering an efficient inventory management approach that is crucial to lowering carbon emissions, particularly for deteriorating goods.

Joint Pricing and Inventory Model for Deteriorating Items with Maximum Lifetime and Controllable Carbon Emissions under Permissible Delay in Payments

Mathematics

Reducing carbon emissions plays a significant role in developing sustainable inventory systems. In a seller-buyer relationship, an allowable delay in payment is considered for the buyer to manage the stock and simulate the demand. Deteriorating items that usually have specific maximum lifetimes have become a challenge for most firms. Contrary to the importance of these issues, very little research has studied the impact of carbon emissions on deteriorating inventory systems. This paper provides a price-dependent demand for perishable items when carbon cap-and-trade regulation fills the mentioned gap. This model provides a carbon reduction investment scheme and illustrates this investment’s effect on the inventory system. This paper determines the optimal replenishment cycle and selling price, in which: (a) perishable items have specific maximum lifetimes, (b) a specific period of delay in payment is allowed for the buyer to accumulate revenue, (c) carbon is emitted due to ordering a...

Single Vendor-Buyer Integrated Inventory Model for Deteriorating Items Considering Carbon Emission

2017

In this study, we present an integrated single vendor-buyer inventory model considering deterioration and carbon emission simultaneously. We focus on the emissions from warehousing, transport activity as well as emission from the disposal of the deteriorated items. A numerical example is developed to illustrate the proposed solution procedure. Computational results indicate that by incorporating carbon emissions into the integrated inventory model, we can reduce the total carbon emission and slightly reduce the total supply chain cost. We also show that the integrated inventory model has significantly reduced the total cost and total carbon emissions as compared to the result when the decision is made solely from the buyer’s perspective.

Three-echelon supply chain model considering carbon emission and item deterioration

Transportation Research Part E: Logistics and Transportation Review, 2019

This study considers an integrated three-echelon supply chain with carbon emissions from transportation and warehousing, as well as disposing of the deteriorated items. It is assumed that transportation and emission reduction policies affect fuel consumption, which in turns affects costs and carbon emissions. The proposed model simultaneously optimizes the number of deliveries and the delivery size from a supplier to a third-party logistics service provider (3PL), and from the 3PL to the buyer in a three-echelon supply chain model considering deterioration and carbon emission. A numerical example and sensitivity analysis are presented to illustrate the proposed model. The result shows the benefit of supply chain integration in terms of total supply chain cost and carbon emission reduction.

An inventory model to study the effect of the probabilistic rate of carbon emission on the profit earned by a supplier

Operations Research and Decisions

The inventory of suppliers providing raw materials to industries producing green products faces two challenging problems. The first one is that raw materials are usually deteriorating items and the second one that they emit carbon-based gases during deterioration. Moreover, each item has its unique carbon emission rate and composition, called the pattern of carbon emission, which is a function of the rate of carbon emission. In this present research, we attempt to develop a stochastic inventory model with price, stock, and pattern of carbon emission-dependent demand to maximise the profit of a supplier selling a single product. The rate of deterioration is a function of the rate of carbon emission and effective investment in preservation. The cost of carbon emission is a function of green investment and the pattern of carbon emission. Holding costs and purchase costs are constant. We consider three patterns of carbon emission, and each pattern is defined by a negative exponential fu...

Joint Effects of Carbon Emission, Deterioration, and Multi-stage Inspection Policy in an Integrated Inventory Model

Asset Analytics, 2019

This paper discusses an integrated inventory model between vendor and buyer for decayed type of products. The vendor produces perfect products but may arrive some defect products in the system. To control product quality, the manufacturer inspects all the products to separate the defective products. After the first-stage inspection, the defective products are reworked at a fixed cost and again inspection takes place for the reworked products in the second-stage inspection. After completion of the second-stage inspection, the defective products are disposed at some fixed cost and delivers good products to the buyer. The delivery of good products is done by single-setup multi-delivery (SSMD) policy by consideration of fixed and variable types of transportation cost. At any stage, the good quality of products may deteriorate and the constant deterioration rate is considered for vendor and buyer, separately. Carbon is emitted from every portion of the integrated system. This issue is st...

Eco-conservational manufacturing inventory framework for deteriorating and defective products

2ND INTERNATIONAL CONFERENCE ON MATHEMATICAL TECHNIQUES AND APPLICATIONS: ICMTA2021

The framework construction of inventory management is dynamic in nature as it is influenced by the growing inexorableness of the stakeholders. The modeling of inventory control is subjected to certain environmental and quality sustenance restraints. The end product is the resultant of either processing of raw materials or assembling of semi-finished products but existence of considerate proportion of deteriorating and defective items is inevitable but controllable by scrutinizing and selecting the feasible methods of treatment and disposal. As environmental costing is made mandatory in business accounting, environmental costs should be reflected in inventory model and the proposal of eco-conservational inventory frameworks are highly essential at this crucial time of global warming as a reflection of industrial responsibilities towards it. The model that is put forwarded in this paper encompasses various quality promotion and environmental costs parameters and this lays a framework for devising extended versions of eco related inventory models suiting the demands of the environment.