An elastic constraint method for a multi-objective production-distribution planning problem with competition

Abstract

Competition is one of the most important topics in supply chain management and it is considered widely in the last decades. This study aims to evaluate effects of Stackelberg and Cournot competition on integrated production-distribution (P-D) planning problem. Minimising cost and maximising satisfaction of service level are considered as two main objective functions then two competitive objective functions are developed within considered competitions. The presented competitive P-D model is totally unimodular and this feature makes the model to generate integer solutions without circumstance of integrality. Next, elastic constraint method is adopted to solve the developed competitive multi-objective model. Finally, numerical examples are conducted to evaluate capability of the proposed approach. According to the structure and assumptions of the proposed model, competition can increase cost of supply chain.