An Optimization Approach to Minimize Supply Chain Costs by Incorporating Lead Time and Demand Variability

One of the most challenging tasks in today’s food industry is controlling the product quality throughout the food supply chain. In addition to that, it is imperative to minimize transportation which could save a lot of money for the organization and could be a sustainable activity that improves the environmental condition. In this paper, a method to formulate the transportation cost and quality costs are done with the respective constraints. A methodology is developed so that it can be integrated in a mixed-integer linear programming model used for production and distribution planning. The resulting model is developed in Excel VBA and applied in an illustrative case study to find the optimal cold supply chain costs.

Advisor: Dr. Vittal Prabhu, Professor, Harold and Inge Marcus Department of Industrial and Manufacturing Engineering, The Pennsylvania State University

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Work Title An Optimization Approach to Minimize Supply Chain Costs by Incorporating Lead Time and Demand Variability
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Penn State
Creators
  1. Karthikeya Prakash Muthiah Ramesh
Keyword
  1. Cold chain
  2. Optimum temperature
  3. Quality deterioration
  4. Lead time variability
  5. Demand variability
License In Copyright (Rights Reserved)
Work Type Research Paper
Publication Date 2021
Deposited March 22, 2021

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