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Mathematics 2019, 7(2), 189; https://doi.org/10.3390/math7020189

Effects of Preservation Technology Investment on Waste Generation in a Two-Echelon Supply Chain Model

Department of Industrial & Management Engineering, Hanyang University, Ansan Gyeonggi-do 155 88, Korea
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Received: 27 December 2018 / Revised: 11 February 2019 / Accepted: 13 February 2019 / Published: 17 February 2019
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Abstract

This study develops an integrated production-inventory model for a two-echelon supply chain network with controllable probabilistic deterioration. The investment in preservation technology is considered a decision variable to control the deteriorated quantity of an integrated system. The objective of the study is to optimize preservation investment, the number of shipments and shipment quantity, so that the total cost per unit of time of the supply chain is minimized. The study proposes a solution method, and the results show that investment in preservation technology reduces the total supply chain cost by 13%. Additionally, preservation increases the lot size, thus increasing the production cycle length, which reduces the ordering cost of the system. Furthermore, this study shows that preservation leads to a reduction of solid waste from deteriorated products. Total deteriorated products reduced to 8 units from 235 units, hence, preservation generates positive environmental benefits along with economic impacts. The robustness of the proposed model is illustrated with a numerical example, sensitivity analysis, and graphical representations. Moreover, comparative study and managerial insights are given to extract significant insights from the model. View Full-Text
Keywords: preservation technology investment; refrigerated trucks; waste reduction; controllable probabilistic deterioration rate; supply chain management preservation technology investment; refrigerated trucks; waste reduction; controllable probabilistic deterioration rate; supply chain management
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Ullah, M.; Sarkar, B.; Asghar, I. Effects of Preservation Technology Investment on Waste Generation in a Two-Echelon Supply Chain Model. Mathematics 2019, 7, 189.

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