Impact of coordination on costs and carbon emissions for a two-echelon serial economic order quantity problem

We consider inventory management decisions when manufacturing and warehousing are controlled by independent entities. The latter possess private information that affects their choices and are allowed to communicate via a mediator who attempts to streamline their decisions without restricting their freedom. The mediator designs a mechanism based on quantity discounts to minimize the overall system costs, attempting to reach a win–win situation for both entities. Using the Revelation Principle, we show that it is in the entities’ self‐interest to reveal their information and we prove that coordination is attainable even under bilateral information asymmetry. The acceptable cost allocation is not unique, providing adequate flexibility to the mediator during mechanism design; the flexibility may reflect the relative power of the entities and is quantified in our work by a series of computational experiments. Our approach is motivated by inventory management practices in a manufacturing group and, thus, it is directly applicable to real‐life cases.

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“…The holding cost is assumed to be proportional to the production cost

P_{S}

(Bouchery et al. ), and is expressed as

P_{S} H_{R}

. In the remainder, we will refer to

H_{R}

as the unit holding cost.…”

Section: Preliminariesmentioning

confidence: 99%

Coordinating Lot Sizing Decisions Under Bilateral Information Asymmetry

Zissis

Ioannou

Burnetas

2020

Production and Operations Management

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“…Toptal and Ç etinkaya [32] studied the effect of supply chain coordination and carbon emissions on vendor-buyer order quantity under lot-for-lot delivery. Bouchery et al [33] examined different supply chain coordination configurations considering carbon emissions under limited vehicle capacity. Dwicahyani et al [34] incorporated carbon emission costs, energy cost, and waste disposal for a two-echelon supply chain with remanufacturing.…”

Section: Low-carbon Supply Chain Managementmentioning

confidence: 99%

Low Carbon Supply Chain Coordination for Imperfect Quality Deteriorating Items

2019

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Nowadays, many countries have implemented carbon pricing policies. Hence, the industry adapts to this policy while striving for its main goal of maximizing financial benefits. Here, we study a single manufacturer–retailer inventory decision considering carbon emission cost and item deterioration for an imperfect production system. This study examines two models considering two cases of quality inspection. The first is when the buyer performs the quality inspection, and the second is when the quality inspection becomes the vendor’s responsibility so that no defective products are passed to the buyer. Carbon emission costs are incorporated under a carbon tax policy, and we consider the carbon footprint from transporting and warehousing the items. The objective is to jointly optimize the delivery quantity and number of deliveries per production cycle that minimize the total cost and reduce the total carbon emissions. This study provides solution procedures to solve the models, as well as two numerical examples.

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“…Overall, there are several options which have to be weighed, taking into consideration of numerous constraints and requirements [11]. Most of developed decision-making models mainly focus on the location of facilities and the right allocation between each level [12][13][14]. In this regard, there are a few works proposing the inventory decisions in addition to the sustainable dimensions [14][15][16][17].…”

Section: Introductionmentioning

confidence: 99%

A Novel Hybrid Whale Optimization Algorithm to Solve a Production-Distribution Network Problem Considering Carbon Emissions

Mehranfar

Hajiaghaei–Keshteli

Fathollahi-Fard

2019

IJE

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Nowadays, there is a great deal of attention for regulations of carbon emissions to enforce the decisionmakers of production and distribution networks to redesign their systems satisfactorily. The literature has seen a rapid interest in developing novel metaheuristics to solve this problem as a complicated optimization problem. Such difficulties motivate us to address a production-distribution network design problem considering carbon emissions policies among the first studies in this area by a novel hybrid whale optimization algorithm. Accordingly, a mixed integer non-linear programming model has been developed. To tackle the proposed problem, a new hybrid metaheuristic based on whale optimization algorithm and simulated annealing as a successful optimizer is employed to solve the proposed problem. The calibration of the algorithms has been designed by Taguchi method, comprehensively. Finally, an extensive analysis has been evaluated through a comparative study along with some assessment metrics of Pareto solutions.

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Impact of coordination on costs and carbon emissions for a two-echelon serial economic order quantity problem

Cited by 57 publications

References 44 publications

Coordinating Lot Sizing Decisions Under Bilateral Information Asymmetry

Coordinating Lot Sizing Decisions Under Bilateral Information Asymmetry

Low Carbon Supply Chain Coordination for Imperfect Quality Deteriorating Items

A Novel Hybrid Whale Optimization Algorithm to Solve a Production-Distribution Network Problem Considering Carbon Emissions

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