Abstract
The need for efficient electrical energy consumption has greatly expanded in the process industries. In this paper, efforts are made to recognize the electrical energy consumption in a two-echelon supply chain model with a stochastic lead-time demand and imperfect production, while considering the distribution free approach. The initial investments are made for quality improvement and setup cost reduction, which ultimately reduce electrical energy consumption. The inspection costs are considered in order to ensure the good qualities of the product. Centralized and decentralized strategies are used to analyze the proposed supply chain model. The main objective of this study is to reduce the overall cost through efficient electrical energy consumption in supply chain management by optimizing the lot size, the number of shipments, the setup cost, and the failure rate. A quantity-based transportation discount policy is applied to reduce the expected annual costs, and a service-level constraint is incorporated for the buyer to avoid a stockout situation. The impact of the decision variables on the expected total costs is analyzed, and sensitivity analysis is carried out. The results show a significant reduction in overall cost, with quality improvement and setup cost reduction ultimately reducing electrical energy consumption.
Highlights
The supply chain is a complex process consisting of several parameters that need to be controlled.Among them, the few parameters that can be controlled by making some additional investments include the setup cost, lead time, and quality of the products, as shown by Sarkar and Sarkar [1].Certain parts of the manufacturing units need to be improved with state-of-the-art technology to reduce the energy consumption and enhance the quality of the products
Some initial capital investments are made for the production process quality improvement and setup cost reduction
A two-echelon supply chain management model was developed in this study considering the effect of imperfect production, the inspection process, and energy consumption
Summary
The supply chain is a complex process consisting of several parameters that need to be controlled. There are some other additional parameters in this model, such as the introduction of transportation discounts, lead-time reduction, and service-level constraints, which improve the process of the efficient utilization of energy. Ben-Daya and Hariga [5] developed an integrated inventory model to obtain the optimal lot size, the reorder point with imperfect items, and the number of shipments They considered that the lead demand follows a normal distribution and depends on the lot size and the transportation delay. To reduce the setup cost and to improve the quality, Ouyang et al [4] utilized the distribution-free approach in a lot size reorder point model with the imperfect production process. The proposed study develops a two-echelon supply chain model with an imperfect production system and identifies the electrical energy consumption costs under a stochastic demand. This section consists of the problem definition, notations, and the assumptions of the model
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