Abstract
Nowadays, many countries have implemented carbon pricing policies. Hence, the industry adapts to this policy while striving for its main goal of maximizing financial benefits. Here, we study a single manufacturer–retailer inventory decision considering carbon emission cost and item deterioration for an imperfect production system. This study examines two models considering two cases of quality inspection. The first is when the buyer performs the quality inspection, and the second is when the quality inspection becomes the vendor’s responsibility so that no defective products are passed to the buyer. Carbon emission costs are incorporated under a carbon tax policy, and we consider the carbon footprint from transporting and warehousing the items. The objective is to jointly optimize the delivery quantity and number of deliveries per production cycle that minimize the total cost and reduce the total carbon emissions. This study provides solution procedures to solve the models, as well as two numerical examples.
Highlights
Chain coordination has a favorable effect on inventory replenishment decisions.Supply chain coordination can be realized through information sharing and joint decision-making.Coordination brings many advantages such as lower inventory-related costs and quality improvement [1]
This study proposes supply chain inventory models that consider carbon emission costs and the existence of defective items under different inspection coordination mechanisms
When the probability of defective products (u) increases, the expected total cost increases very slightly, especially when the inspection is performed by the vendor
Summary
Chain coordination has a favorable effect on inventory replenishment decisions. This study proposes supply chain inventory models that consider carbon emission costs and the existence of defective items under different inspection coordination mechanisms. This study incorporates carbon emissions, item deterioration, and defective percentage to guide the supply chain managers to make the inventory decisions on the delivery size and the number of the fixed and variable inspection costs, the model extends Tiwari et al.’s [15] model by introducing weight and distance-dependent transportation cost and emission variables. This study incorporates carbon emissions, item deterioration, and defective percentage to guide the supply chain managers to make the inventory decisions on the delivery size and the number of deliveries perper cycle.
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