The economic and environmental performance of distribution networks: A case study from the petrochemical industry

Designing a company's distribution network is a challenging task that requires the consideration of different aspects. In this respect, especially trade-offs between, for example, operational costs and customer service are the focus of the companies' attention. However, growing concerns of governments and customers about environmental protection have raised awareness towards the environmental impact of operations. Activities associated with the distribution of products, i.e. transportation and warehousing, are not yet subject to strict environmental regulations, but this situation is expected to change soon. Companies must, therefore, start to concentrate not only on economic but also on environmental aspects in the design of their supply chain. Based on a case study from the petrochemical industry, this paper presents a way to combine both, economic as well as environmental criteria, when evaluating (strategic) distribution network design decisions. The results show a trade-off between total (distribution) costs and transport carbon emissions. (author's abstract

A Multicriteria Analysis for the Green VRP: A Case Discussion for the Distribution Problem of a Spanish Retailer

[EN] This research presents the group of green vehicle routing problems with environmental costs translated into money versus production of noise, pollution and fuel consumption. This research is focused on multi-objective green logistics optimization. Optimality criteria are environmental costs: minimization of amount of money paid as externality cost for noise, pollution and costs of fuel versus minimization of noise, pollution and fuel consumption themselves. Some mixed integer programming formulations of multi-criteria vehicle routing problems have been considered. Mathematical models were formulated under assumption of existence of asymmetric distance-based costs and use of homogeneous fleet. The exact solution methods are applied for finding optimal solutions. The software used to solve these models is the CPLEX solver with AMPL programming language. The researchers were able to use real data from a Spanish company of groceries. Problems deal with green logistics for routes crossing the Spanish regions of Navarre, Basque Country and La Rioja. Analyses of obtained results could help logistics managers to lead the initiative in area of green logistics by saving money paid for environmental costs as well as direct cost of fuel and minimization of pollution and noise.This work has been partially supported by the National Research Center (NCN), Poland (DEC-2013/11/B/ST8/04458), by AGH, and by the Spanish Ministry of Economy and Competitiveness (TRA2013-48180-C3-P and TRA2015-71883-REDT), and the Ibero-American Program for Science and Technology for Development (CYTED2014-515RT0489). Likewise, we want to acknowledge the support received by the CAN Foundation in Navarre, Spain (Grants CAN2014-3758 and CAN2015-70473)Sawik, B.; Faulin, J.; Pérez Bernabeu, E. (2017). A Multicriteria Analysis for the Green VRP: A Case Discussion for the Distribution Problem of a Spanish Retailer. Transportation Research Procedia. 22:305-313. https://doi.org/10.1016/j.trpro.2017.03.037S3053132

Optimizing multi-objective dynamic facility location decisions within green distribution network design

Despite the surge of sustainable economic development which inspires corporations to optimize investment on environmental-friendly infrastructural facilities, limited pragmatic evidences are observed in product-service networks. The importance of such optimized decisions would be highlighted where various stakeholders' objectives are involved in network design. This paper addresses the joint study of optimization for profitability, customer satisfaction, and sustainability by optimizing facility location decisions in distribution-service network with forward and reverse streams. The contribution is minimizing establishment, transportation and inventory management costs and simultaneously maximizing customer satisfaction with sustainable perspective. The presented model is the optimum approach for multiobjective, multi-period, multi-commodity, distribution-service system. The applicability of the proposed model is validated by a real case study. Provided solution proved that a green distribution-service network will increase the efficiency in terms of profitability and customer satisfaction.Scopu

Eco-efficient supply chain networks: Development of a design framework and application to a real case study

© 2015 Taylor & Francis. This paper presents a supply chain network design framework that is based on multi-objective mathematical programming and that can identify 'eco-efficient' configuration alternatives that are both efficient and ecologically sound. This work is original in that it encompasses the environmental impact of both transportation and warehousing activities. We apply the proposed framework to a real-life case study (i.e. Lindt & Sprüngli) for the distribution of chocolate products. The results show that cost-driven network optimisation may lead to beneficial effects for the environment and that a minor increase in distribution costs can be offset by a major improvement in environmental performance. This paper contributes to the body of knowledge on eco-efficient supply chain design and closes the missing link between model-based methods and empirical applied research. It also generates insights into the growing debate on the trade-off between the economic and environmental performance of supply chains, supporting organisations in the eco-efficient configuration of their supply chains

A SIMULATION FOR UNDERSTANDING THE ROLE OF INFORMATION SYSTEMS AND INFORMATION QUALITY IN THE MOVE TOWARDS A GREEN SUPPLY CHAIN

This research in progress aims at investigating the role that information system (IS) and information quality (IQ) can play for the transformation of a Supply Chain. A case study was conducted to identify the supply chain evolution of a major French retailer that initiated consolidation centres for shared deliveries between several small suppliers to its warehouses. This initiative aims at developing just-in-time delivery for economic benefits and the retailer explains that this evolution meets environmental benefits through CO2 reduction. However, the promised benefits for suppliers depend upon the development of information sharing and information quality and they have the choice to adopt the ?green supply chain? or to continue delivering directly without using the consolidation centers. Therefore this paper presents the simulation of the research that is currently being performed in order to identify the necessary conditions for the benefits realization. For future research, we propose a multi-agent based modelling for understanding how IS and IQ are pushing towards the adoption of a green supply chain

Simulation of In Bag Fertilizer Loading Process In Port of Petrokimia Gresik to Increase Loading Rate

Pelabuhan Petrokimia Gresik is one of the element to support the goverment regarding to maintain stability of fertilizer loading speed. The issue that occurs at Pelabuhan Petrokimia Gresik is the low speed of loading of fertilizer in the bag for the past 4 years. The low speed of loading fertilizer in bag tends to affect its cost. This study aims to simulate the process of loading fertilizer in bag at the Port of Petrokimia Gresik in order to find out the factors which influence the speed deterioration of fertilizer bagging process and applicable alternative scenarios to improve the process of loading fertilizer in bag. Simulations were executed using discrete simulation methods. The results show that loading speed downturn are influenced by significant factors as follows: high loading preparation time at the dock, which consumes 29,35% of loading activity; the high loading time at the dock, which reaches 23,15% of loading activity; also the extensive duration of truck commute from the warehouse to the pier which utilizes 22,95% of loading activity. This study evaluate 7 alternative improvement scenarios. According to ROI perspective, it is preeminent to additionally put field internal control personnel at each shift when loading fertilizer in bag, which can increase the loading speed to 668,29 tons / day, of investment (ROI) of 68% will be obtained within 1 year and the payback period will approximately result in 0,60 years. The best scenario in terms of loading speed is to add internal control personnel and apply a new method of loading fertilizer using a sling bag with an increase in loading rate to 804.17 tons / day, following ROI value of 23% within one year and a PP value of 0.81 year