Modeling and Optimization of Inventory-Distribution Routing Problem for Agriculture Products Supply Chain

Mathematical models of inventory-distribution routing problem for two-echelon agriculture products distribution network are established, which are based on two management modes, franchise chain and regular chain, one-to-many, interval periodic order, demand depending on inventory, deteriorating treatment cost of agriculture products, start-up costs of vehicles and so forth. Then, a heuristic adaptive genetic algorithm is presented for the model of franchise chain. For the regular chain model, a two-layer genetic algorithm based on oddment modification is proposed, in which the upper layer is to determine the distribution period and quantity and the lower layer is to seek the optimal order cycle, quantity, distribution routes, and the rational oddment modification number for the distributor. By simulation experiments, the validity of the algorithms is demonstrated, and the two management modes are compared

Modeling and Optimization of Inventory-Distribution Routing Problem for Agriculture Products Supply Chain

Mathematical models of inventory-distribution routing problem for two-echelon agriculture products distribution network are established, which are based on two management modes, franchise chain and regular chain, one-to-many, interval periodic order, demand depending on inventory, deteriorating treatment cost of agriculture products, start-up costs of vehicles and so forth. Then, a heuristic adaptive genetic algorithm is presented for the model of franchise chain. For the regular chain model, a two-layer genetic algorithm based on oddment modification is proposed, in which the upper layer is to determine the distribution period and quantity and the lower layer is to seek the optimal order cycle, quantity, distribution routes, and the rational oddment modification number for the distributor. By simulation experiments, the validity of the algorithms is demonstrated, and the two management modes are compared

A Multi-echelon Inventory System with Supplier Selection and Order Allocation under Stochastic Demand

This article addresses the development of an integrated supplier selection and inventory control problems in supply chain management by developing a mathematical model for a multi-echelon system. In particular, a buyer firm that consists of one warehouse and N identical retailers wants to procure a type of product from a group of potential suppliers, which may require different price, ordering cost, lead time and have restriction on minimum and maximum total order size, to satisfy the stochastic demand. A continuous review system that implements the order quantity, reorder point (Q, R) inventory policy is considered in the model. The objective of the model is to select suppliers and to determine the optimal inventory policy that coordinates stock level between each echelon of the system while properly allocating orders among selected suppliers to maximize the expected profit. The model has been solved by decomposing the mixed integer nonlinear programming model into two sub-models. Numerical experiments are conducted to evaluate the model and some managerial insights are obtained by performing some sensitivity analysis

Synchronization and decoupling of plants piloting in a supply chain dedicated to customized mass production.

The synchronization of the production of a manufacturing supplier, who makes alternate components assembled on his industrial customer’s work station with this client’s production specialized in mass production of highly diversified products, must take into account the improvement of their knowledge of the final demand (displacement of the Order Penetration Point) and the distance of some of the suppliers. The customer periodically forwards firm orders to his supplier calculated so as to preclude any production line stoppage. It is necessary that the supplier honor them to ensure the decoupling of the control of these two entities in the supply chain and define the efficiency of synchronization. In the considered context, the supplier also receives all available projected information from the industrial customer (final orders, firm on the short term, and structural characteristics of the final demand beyond). The efficiency of the supplier depends on the proper use of all information, notably when the production cycle of alternate components is longer than the demand cycle. In the study of the customer’s requirements, it is necessary to take into account the batch constraints linked to transportation, which compels the customer to hold safety stocks even though the set up organization guarantees that orders will be duly honored. The determinants of these stocks will be put in evidence. Similarly at the supplier, safety stocks will be necessary if the production process involves grouping in batches.synchronisation de la production dans une chaîne logistique; stock de sécurité; chaîne logistique;

Aplicación de modelos de inventarios en una cadena de abastecimiento de productos de consumo masivo con una bodega y N puntos de venta.

Uno de los problemas más complejos que afectan las empresas industriales y comerciales locales es la administración y control de los inventarios. Es muy frecuente escuchar el problema del desbalanceo de inventarios: "¿Por qué será que siempre se tiene mucho de lo que casi no se vende y hay faltantes de lo que sí rota?" En este artículo se abordarán las causas de este problema y sus posibles soluciones, especialmente en cadenas de suministro con una bodega y múltiples puntos de venta (OneWarehouse NRetailer Problem). Se discutirán diversas técnicas de control de inventarios para este sistema, concentrándose también en sus aspectos logísticos generales, ilustrando con la aplicación real en una empresa comercializadora de productos de consumo masivo. Los impresionantes resultados obtenidos evidencian un excelente potencial de aplicación de estos modelos en empresas comerciales o industriales interesadas en basar sus procesos de toma de decisiones en la investigación de operaciones. Estos resultados motivan el continuo desarrollo de proyectos de investigación aplicada en las organizaciones de la región

An enhanced approximation mathematical model inventorying items in a multi-echelon system under a continuous review policy with probabilistic demand and lead-time

An inventory system attempts to balance between overstock and understock to reduce the total cost and achieve customer demand in a timely manner. The inventory system is like a hidden entity in a supply chain, where a large complete network synchronizes a series of interrelated processes for a manufacturer, in order to transform raw materials into final products and distribute them to customers. The optimality of inventory and allocation policies in a supply chain for a cement industry is still unknown for many types of multi-echelon inventory systems. In multi-echelon networks, complexity exists when the inventory issues appear in multiple tiers and whose performances are significantly affected by the demand and lead-time. Hence, the objective of this research is to develop an enhanced approximation mathematical model in a multi-echelon inventory system under a continuous review policy subject to probabilistic demand and lead-time. The probability distribution function of demand during lead-time is established by developing a new Simulation Model of Demand During Lead-Time (SMDDL) using simulation procedures. The model is able to forecast future demand and demand during lead-time. The obtained demand during lead-time is used to develop a Serial Multi-echelon Inventory (SMEI) model by deriving the inventory cost function to compute performance measures of the cement inventory system. Based on the performance measures, a modified distribution multi-echelon inventory (DMEI) model with the First Come First Serve (FCFS) rule (DMEI-FCFS) is derived to determine the best expected waiting time and expected number of retailers in the system based on a mean arrival rate and a mean service rate. This research established five new distribution functions for the demand during lead-time. The distribution functions improve the performance measures, which contribute in reducing the expected waiting time in the system. Overall, the approximation model provides accurate time span to overcome shortage of cement inventory, which in turn fulfil customer satisfaction

Cooperation in Supply Chain Networks: Motives, Outcomes, and Barriers

This paper analyzes the phenomenon of cooperation in modern supply chains in the light of Game Theory. We first provide a discussion on the meaning of cooperation in supply chains, its motives, outcomes and barriers. We then highlighted the applicability of Cooperative Game Theory as methodology for analyzing cooperation in supply chains. Second, we review recent studies that analyze the cooperation in supply chains by means of cooperative game theory. A special emphasis will be given inventory centralizations games. Finally, gaps in the literature are identified to clarify and to suggest future research opportunities

Exogenous coalition formation in the e-marketplace based on geographical proximity

This paper considers a model for exogenous coalition formation in e-marketplaces. Using the informational advantage e-retailer creates coalitions of customers based on geographical proximity. Most of the literature regards this process as endogenous: a coalition leader bundles eventual purchases together in order to obtain a better bargaining position. In contrast - and in response to what is being observed in business practice - we analyse a situation in which an existing e-retailer exogenously forms customers' coalitions. Results of this study are highly encouraging. Namely, we demonstrate that even under highly imperfect warehouse management schemes leading to contagion eects, suggested combined delivery service may oer signifficant efficiency gains as well as opportunities for Pareto-improvement.Coalition formation, e-commerce, multi-agent systems, consumer satisfaction, demand planning, warehouse management.

AN INVENTORY MODEL FOR OPTIMIZATION OF A TWO-ECHELON PERIODIC-REVIEW SYSTEM

In this article a single-item inventory model for a two-echelon system made up of a warehouse and N retailers is proposed. The warehouse adopts an interval between reviews that is an integer multiple of the interval used in the retailers. The retailers apply reviews at equal, synchronized intervals. The algorithm developed for the model determines the order-up-to level at each stockpoint so that the target service-level is met at the retailer at minimal cost to the system. In order to determine how effective the proposed model was, a simulation was performed to observe the service level for an item with normal demand in a three-retailer system using order-up-to levels supplied by the proposed algorithm.