An Inventory Model for Deteriorating Commodity under Stock Dependent Selling Rate

Economic order quantity (EOQ) is one of the most important inventory policy that have to be decided in managing an inventory system. The problem addressed in this paper concerns with the decision of the optimal replenishment time for ordering an EOQ to a supplier. This Model is captured the affect of stock dependent selling rate and varying price. We developed an inventory model under varying of demand-deterioration-price of commodity when the relationship of supplier-grocery-consumer at stochastic environment. The replenishment assumed instantaneous with zero lead time. The commodity will decay of quality according to the original condition with randomize characteristics. First, the model is addressed to solve a problem phenomenon how long is the optimum length of cycle time. Then, an EOQ of commodity to be ordered by will be determined by model. To solve this problem, the first step is developed a mathematical model based on reference’s model, and then solve the model analytically. Finally, an inventory model for deteriorating commodity under stock dependent selling rate and considering selling price was derived by this research. Keywords: deterioration commodity, expected profit, optimal replenishment time stock dependent selling rate

A Buffer Stocks Model for Stabilizing Price of Commodity under Limited Time of Supply and Continuous Consumption

Staple foods, in developing countries especially in Indonesia, have extremely volatile among harvest and planting season caused by inelastic of supply-demand and price disparity. When a staple food is shortage in market, it will trigger crisis of economics, political and social because it concerns with food security. This paper develops a buffer stock model for stabilizing price of commodity under limited time of supply and continuous consumption. The performance criterion of model will consider financial loss of producer, consumer and government side when market is interfered by price-stabilization program and price-support program simultaneously. The price fluctuation will be stabilized by market operation where buffer stocks are bought from domestic and import supply point. This paper provides a price band policy that attempts to bound domestic price variation between a set of upper and lower bounds on the level of domestic prices. We consider three sets of problems reflecting different three prices elasticity from 4 period of supply and demand. Numerical examples are found to be consistent with empirical estimates regarding the relationship price elasticity with price band and with government budget for the agenda of assisting household to assure availability a staple food with enough amounts at rational prices. Keywords: buffer stocks, price band, stabilization, limited time of supply, staple foods

Integrated Production-Distribution Planning with Considering Preventive Maintenance

The preventive maintenance activity is important thing in production system especially for a continuous production process, for example in fertilizer industry. Therefore, it has to be considered in production-distribution planning. This paper considers the interval of production facility’s preventive maintenance in production-distribution planning of multi echelon supply chain system which consists of a manufacturer with a continuous production process, a distribution center, a number of distributors and a number of retailers. The problem address in this paper is how to determine coordinated productiondistribution policies that considers the interval of production facility’s preventive maintenance, and customer demand only occurred at retailers and it fluctuates by time. Based on model of Santoso, et al. (2007), using the periodic review inventory model and a coordinated production and replenishment policies that are decided by central planning office and it must be obeyed by all entities of multi-echelon supply chain, the integrated production-distribution planning model is developed to determine the production and replenishment policies of all echelon in the supply chain system in order to minimize total system cost during planning horizon. Total system cost consists of set-up/ordering cost, maintenance cost, holding cost, outsourcing cost and transportation cost at all of entities. With considering preventive maintenance and there is one production run over the planning horizon, the replenishment cycle at distribution center, distributors and retailers that are found out are greater than the basic model. Also, the multiplication of replenishment cycle at distribution center in production cycle that is found out is greater than the basic model but the multiplication of replenishment cycle at retailers in its distributor are smaller than the basic model

BUFFER STOCK MODEL FOR STABILIZING PRICE WITH CONSIDERING THE EXPECTATION STAKEHOLDERS IN THE STAPLE-FOOD DISTRIBUTION SYSTEM

The extremely different supplies between the harvest season and the planting season are one of serious problem in the staple-food distribution system. In free-market mechanism, this extreme difference will trigger price-volatility and shortage of staple-food. This situation causes opportunity-losses for the stakeholders (producer, consumer, agent and government) in the staple-food distribution system. The government has got incurred losses because the government cannot achieve food-security for the households. The government has several price stabilization policies; one of them is market intervention policy by using buffer stock schemes to stabilize price and to reduce losses for the stakeholders. The objective of this research is to determine the buffer stock schemes required for market-intervention program. In the previous researches, the buffer stock models have been developed separately based on optimization and econometrics methods. Optimizations methods have been used to determine the level of availability with schemes consist of time and quantity of buffer stock. Econometrics methods have been used to determine the equilibrium price by using the selling-price and the amount of buffer stock. In this research, the integration of optimization model (multi-objectives programming) and econometrics model are used to develop a buffer stock model with the decision variables that consist of quantity, time, and price. Key Words: Buffer Stock Model, Market-Intervention, Price-Stabilizatio

A Buffer Stocks Model for Stabilizing Price in Duopoly-Like Market

This paper presents the staple-food distribution problem in agro-industry. There is a great difference of staple-food supplies in the harvest-season and in the planting-season meanwhile the demand is relatively constant. This situation will trigger price-volatility and shortage of staple-food, and it causes opportunity-losses for the stakeholders (producer, consumer, wholesaler/trader, and the government). For stabilizing the price, the government has several stabilization policies; one of them is market-intervention policy by using buffer-stocks schemes. The market-intervention policy should be utilized for improving producer’s profit, for cutting consumer’s expenditure, and for sustaining wholesaler’s margin-profit by implementing price-support and price-stabilization. In duopoly-like market, we assume that there are only two market-players in the distribution system. The objective of this research is to determine the instruments for operating Market-Intervention Program which consist of the quantity, time, and price of the buffer-stocks schemes. The problem was solved using 3 approaches. First, a comparative cost/benefit analysis between free-market and intervention-market can be used to formulate the objective function of each stakeholders. Second, the integration of optimization model and econometrics model were use to develop the decision-variables subject to the expectation of stakeholders, the buffer-stocks requirement, and the dynamics price equilibrium properties. Third, model market with Inventory was applied for solving the market-price equilibrium. The result could be used to analyze such the staple-food distribution system, incorporating the configuration of duo-producers, duo market-buyers, and duo-consumers. Keywords: buffer-stocks, duopoly-like market, market-intervention program, model market with inventory, and staple-food distribution system

PENGAMBILAN KEPUTUSAN KOMPONEN DARAH DALAM PENGENDALIAN PERSEDIAAN DENGAN MENGGUNAKAN METODE AHP DI PMI KOTA BANDUNG

PMI Kota Bandung mengalami overstock. Persediaan darah yang overstock dan mengalami kadaluarsa harus dilakukan pemusnahan. Pada fase overstock setiap bulannya PMI Kota Bandung mengalami waste dan perlu dilakukan pengendalian persediaan. Pada darah terdapat enam komponen darah yang perlu dikendalikan persediaannya, namun diperlukan waktu yang cukup lama untuk menganalisis setiap komponen darah. Diperlukan penentuan komponen darah prioritas yang harus segera dikendalikan sehingga diharapkan dapat berpengaruh terhadap penurunan biaya pemusnahan darah kadaluarsa. Tujuan penelitian ini adalah untuk mengetahui komponen darah apa yang diprioritaskan untuk dikendalikan persediaannya. Penentuan prioritas komponen darah menggunakan pendekatan AHP (Analitycal Hierarchy Process). Metode AHP merupakan model pengambilan keputusan yang menguraikan masalah multi kriteria yang kompleks menjadi suatu hirarki. komponen darah yang prioritas untuk di kendalikan adalah kompoenen Packed Red Cell (PRC) sebesar 0,338. Nilai ini diperoleh karena dipengaruhi oleh bobot pada kriteria supply sebesar 0,709; demand sebesar 0,113; dan lifetime sebesar 0,179.PMI of Bandung City experienced overstock. Overstock and expired blood supplies must be destroyed. In the overstock phase every month, PMI of Bandung City experiences waste and needs to be controlled inventory. In the blood have six components that need to be controlled, but it takes a long time to analyze each component of the bloood. It is necessary to determine the priority blood components that must bee controlled immediately so that they are expected to influence the reduction in the destroyed cost. The purpose of this study is find out what blood component are prioritized to control their supply. Determination of blood component priority using the AHP (Analitycal Hierarchy Process) approach. The AHP method is decision making model that breaks down complex multi-criteria problems into a hierarchy. The priority blood component to be controlled is Packed Red Cell (PRC) component of 0.338. This value is obtained because it is influenced by the weight of the supply criteria of 0.709, demand of 0.113; and lifetime of 0.179

A Buffer Stock Model to Ensure Price Stabilization and Availability of Seasonal Staple Food under Free Trade Considerations

Abstract. The price volatility and scarcity have been became a great problem in the distribution system of seasonal staple food produced by agro industry. It has salient supply disparity during the harvest and planting season. This condition could cause disadvantages to the stakeholders such as producer, wholesaler, consumer, and government. This paper proposes a buffer stock model under free trade considerations to substitute quantitative restrictions and tariffs by indirect market intervention instrument. The instrument was developed through buffer stock scheme in accordance with warehouse receipt system (WRS) and collateral management system. The public service institution for staple food buffer stock (BLUPP) is proposed as wholesaler’s competitor with main responsibility to ensure price stabilization and availability of staple food. Multi criteria decision making is formulated as single objective a mixed integer non linear programming (MINLP). The result shows that the proposed model can be applied to solve the distribution problem and can give more promising outcome than its counterpart, the direct market intervention instrument

Location-inventory-routing model with considering urban road networks

Purpose: To develop LIRP (location-inventory-routing problem) model with considering multiple links and solve it using method of heuristic based on algorithm of simulated annealing. Method of heuristic for the LIRP model is applied in city of Jakarta to improve effectiveness and efficiency of the food supply chain. Design/methodology/approach: The LIRP model is developed using main references. To solve the model, this paper develops two methods, namely method of optimal and method of heuristic. Computational experiments are performed to obtain the efficiency of the method of heuristic. New design of food supply chain is resulted from the application of the method of heuristic in city of Jakarta. Findings: The new design of food supply chain resulted from the application of LIRP model in city of Jakarta reduces total cost by 18%, increases availability from 76% to 95%, and reduces the number of vehicles by 73%. This paper also shows that distance is not the only consideration to decide the traversed links in cities. Research limitations/implications: Average gap between method of heuristic and method of optimal in terms of total cost is 3.1%. Practical implications: Government of city of Jakarta can improve effectiveness and efficiency of the food supply chain by implementing the LIRP model. Social implications: Citizens of Jakarta are well provided with their needs of vegetables and fruits. Originality/value: The first LIRP model that considers multiple links to represent road networks in cities. The LIRP model developed in this paper consists of probabilistic demands, multi products, and multi echelons. Traditional markets, UCCs (urban consolidation centers) and province of suppliers are the places where decisions of inventory madePeer Reviewe

A conceptual assessment model to identify phase of industrial cluster life cycle in Indonesia

Purpose: The purpose of this research is to develop an assessment model to identify phase of industrial cluster life cycle which comprises definition of the cycle phases, identification of assessment components, and characterization of each phase of cluster life cycle. Design/methodology/approach: This research uses the Delphi method to develop the conceptual model i.e. define phases of cluster life cycle and identify assessment components, and design typology of cluster life cycle. Findings: The proposed indicators used to assess industrial cluster phases are (i) concentration of industry, (ii) market accessibility, (iii) completeness of actors, and (iv) collaboration of stakeholders. Research limitations/implications: This study developed a conceptual model based on expert opinion in Indonesia. Given the limitations of experts in this field in Indonesia, it is necessary to develop advanced research involving more experts and if possible, to involve experts outside Indonesia. Practical implications: This paper provides an assessment conceptual model to identify phase of industrial cluster life cycle. The objective of assessing industrial cluster phases is to evaluate and improve the condition of industrial clusters and as basis for formulation policy interventions in accordance with each phase of cluster life cycle. The final results of this study are the position of each cluster on their life cycle, which reflects the condition of each industrial cluster. On a practical level, the assessment result could be used to improve the competitiveness of industrial sectors and help local and central government to formulate appropriate policy interventions. Originality/value: The paper provides an assessment conceptual model to identify phases of industrial cluster life cycle, which include definition phases, assessment components and typology of each phase of cluster life cycle based on assessment criteria. Research in this field was rarely done by the other researchers.Peer Reviewe

The development of a conceptual rural logistics system model to improve products distribution in Indonesia

Purpose: The role of speculators in distributing products across rural areas is increasing the poverty rate in Indonesia. Therefore, this study aims to develop a conceptual framework of the rural logistics system model to influence the welfare and sustainability of farmers. Design/methodology/approach: Conceptual framework was used to evaluate logistics and supply chain networks. The method consists of developing stages based on four components, namely network structure, management, resources, and business processes. Furthermore, it also proposed the management function of the rural logistics system models. Findings: The model of a rural logistics system obtained in this study consists of 1) a trade related to the network of business, 2) a freight, related to the flow of goods, and 3) management functions related to crucial activities in rural logistics management. Research limitations/implications: This model is conceptual, therefore, future studies must accommodate optimizing models to predict the performance of rural logistics systems when they are applied in Indonesia. Practical implications: This study promotes the actors in intermediaries of the rural logistics system to synergize the distribution of goods effectively and efficiently. It also reduces the role of speculators in product distribution in form of availability and price in rural areas. Social implications: This model is a strategy to achieve the Rural Sustainable development Goals (Rural-SDGs) agenda and complements the Blueprint of The National Logistics System. Originality/value: There are fewer studies in rural logistics compared to other fields such as agricultural logistics, food logistics, disaster logistics, etc. Therefore, this study organizes the actors in the rural logistics network and plans management functions for the efficient distribution of products across Indonesia. It also raises the awareness of logistics management to improve the welfare of rural communitiesPeer Reviewe