Performance evaluation of a merge supply network: A distribution centre with multiple reliable random suppliers

Abstract

In this study a two echelon discrete flow convergent supply network system is examined. Multiple reliable suppliers with different processing rates feed a distribution centre with a shared buffer. The first echelon consists of a distribution centre and a shared buffer. The second echelon includes multiple non-identical suppliers that feed the distribution centre. Each supplier has their service rate. The active lead times (production & delivery time) are exponentially distributed. The supply network is modeled as a continuous time Markov process with discrete states. The structure of the transition matrices of these specific systems is explored and a computational algorithm is developed to generate stationary distribution for different values of the system characteristics.The effect of certain system characteristics, such as the capacity of the distribution centre, the buffer capacity and the number of suppliers, on the system performance measures, such as the output rate (throughput), the work in process in the system and the distribution centre are traced through numerical experiments. The computational algorithm is used as a design tool to optimise the system’s performance, i.e. to achieve the maximisation of throughput, the minimisation of wip, etc.