Integrated Optimization Model for Sustainable Supplier Selection and Order Allocation in Food Supply Chain

Abstract

Sustainability consciousness among food manufacturers or transformers is one of the principal drivers for a sustainable food supply chain (SC) and it creates a possibility to enforce sustainability across all tiers of suppliers. This paper focuses on addressing sustainable supplier selection and optimal order allocation problem in agri-food SC. For this, an integrated bi-objective optimization model is developed in the study for configuring the SC network. It facilitates the selection of sustainable suppliers, allocates optimum order quantities among the selected suppliers, and determines flow of units across all the echelons of the SC network. The central focus is on enhancing the sustainable impact of the SC while keeping the SC costs at the minimum. The model developed in the study contains a three-phase comprehensive approach. The primary phase utilizes Best–Worst Method for evaluating and selecting sustainable suppliers based on economic, environmental, and sustainability criteria; the secondary phase involves formulation of a mixed-integer programming model for configuring the SC network and addressing the supplier selection and order allocation problem while aiming to achieve a compromised solution between the fuzzy objectives of minimization of cost and maximization of the sustainable value of purchase. In the final phase, fuzzy programming is effectively utilized for obtaining a compromised solution to the fuzzy bi-objective model utilizing real data of a case study from flour milling industry in India.