Alamri, A.A. Efficient Formulation for Vendor–Buyer System Considering Optimal Allocation Fraction of Green Production. Axioms2023, 12, 1104.
Alamri, A.A. Efficient Formulation for Vendor–Buyer System Considering Optimal Allocation Fraction of Green Production. Axioms 2023, 12, 1104.
Alamri, A.A. Efficient Formulation for Vendor–Buyer System Considering Optimal Allocation Fraction of Green Production. Axioms2023, 12, 1104.
Alamri, A.A. Efficient Formulation for Vendor–Buyer System Considering Optimal Allocation Fraction of Green Production. Axioms 2023, 12, 1104.
Abstract
The classical joint economic lot-sizing (JELS) policy in a single-vendor single-buyer system generates an equal production quantity in all cycles, where the input parameters remain static indefinitely. In this paper, a new two-echelon supply chain inventory model is developed involving a hybrid production system that simultaneously focuses on green and regular production methods with optimal allocation fraction of green and regular productions. Unlike the classical mathematical formulation, each cycle is independent from the previous one, and consequently, the input parameters can be adjusted to be responsive to the dynamic nature of demand rate and price fluctuation. A rigorous heuristic approach is used to derive a global optimal solution for a joint hybrid production system. The model accounts for carbon emissions from production and storage activities related to green and regular produced items along with transportation activity under a multi-level emission-taxing scheme. The results emphasize the significant impact of green production on emissions. That is, the higher the allocation fraction of green production the lower the total amount of emissions generated by the system, i.e., the system becoming more sustainable. Adopting a hybrid production method not only decreases the greenhouse gas (GHG) emissions dramatically, but also reduces the per unit time total cost when compared with regular production. One of the main findings is that the total system cost generated by the base closed-form formula of the proposed model is considerably lower than that of the existing literature i.e., 33.59% (16.13%) lower in the first cycle (subsequent cycles) when the regular production method is assumed. Moreover, the optimal production rate generated by the proposed model is the one that minimizes the emissions production function. Illustrative examples and special cases that reflect different realistic situations are compared to outline managerial insights.
Keywords
vendor-managed inventory; hybrid production; optimal fraction of green production; carbon emissions; emissions tax and penalty; first-time interval.
Subject
Computer Science and Mathematics, Applied Mathematics
Copyright:
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
