Carbon constrained dual sourcing supplier selection problem: a Benders decomposition approach

Abstract

Carbon constrained supplier selection is a relatively newer concept compared to traditional supplier selection problem. Most of the decision makers face difficulty to select supplier in dual sourcing (global or local) scenarios, which generally have different cost and emission factors. As of now, very few supplier selection models have been proposed taking consideration dual sourcing and carbon footprint issues. This paper proposes a mixed integer-based multi-product, dual (global and domestic) sourcing supplier selection model especially considering carbon emission, carbon cap, costs, tax, quality rejection, lead time, various duties and solved using Benders decomposition algorithm. The proposed model is illustrated through a case study and various sensitivity analyses are performed by varying carbon footprint of material, lead time, supplying capacity and minimum order size. Further, this paper helps managers to decide the amount of domestic as well as global sourcing percentages in a carbon constrained situation.