Integrated modeling and optimization of material flow and financial flow of supply chain network considering financial ratios

Abstract

In today's competitive environment, businesses are searching for tools and instruments, using which they can reduce their costs as much as possible in order to increase profits. The supply chain as a process which requires comprehensive management can be a great help in this regard for companies. The majority of approaches evaluated in supply chain primarily deal with logistic and material flows and neglect a lot of financial dimensions. This is while the financial flow in the supply chain can play an effective role in improving and optimizing the chain and contribute heavily to the profitability of the business. This paper deals with the financial flow of the supply chain model along with the material flow. It indicates that while optimizing the financial flow will provide the maximum profit for the plant, through simultaneous modeling of both these flows, better results can be reached. On the other hand, optimizing the financial flow allows the financial factors to be also considered in the model, which helps the business reach higher profits and better management of financial processes, which in turn shifts the business towards a modern industrial unit.

Business Cost Modelling of Information Processing in Supply Chain Units

“…The following part of the paper shows the comparison of the total cost of handling customer inquiries by orders and customers (see Figure 6). Furthermore, Figure 7 describes graphically the absolute difference between model 1 and model 2 for C_ (1,2,3,4,5), n and C_m, (1, 2, 3, 4 , 5).…”

“…Supply chain optimization is one of the key conditions for ensuring economic efficiency of all types of companies [1], [2]. One of the organizational and functional goals of all companies is to ensure a smooth supply of materials or input products to the production line while avoiding excessive levels of material reserves in their warehouses [3].…”

“…n-th product for the m-th customer can be made, e. the n-th product inquiry of m-th customer is modified (if rejected, then1 …”