Presenting a two-echelon multi-objective supply chain model considering the expiration date of products and solving it by applying MODM

Abstract

The supply chain (SC) as the most significant factor influencing competitive advantage has a great impact on the organization's life and progress. Considering the expiration date of products in supply chain modeling is essential for ensuring operational efficiency, reducing waste, maintaining product quality, and ultimately driving business success. Therefore, this paper provides a two-level supply chain including manufacturer and distributor then chain modeling with considered conditions and applying the concept of Markowitz's theory. Finally, drawing the optimal cost curve of producer and distributor as an efficient frontier. For this purpose, the main contribution of the paper is determining the optimal cost of each level of the chain if the cost of another level is known and increasing the power of analysis. The proposed model applied in Darupakhsh Manufacturing Company and Mahya Daroo Distribution Company, a two-echelon supply chain design, including a manufacturer and a distributor is developed. At first, this chain is modeled, and then, implementing the concept of Markowitz theory, the optimal cost curve of producer and distributor is drawn as an efficient frontier. Findings show it is found that the optimal cost of the two echelons of the chain is inversely correlated and decreases with the increase of another one. Furthermore, it is found that the producer warehouse limit is redundant and has no effect on the final response. Also, with the increase in the cost of the manufacturer, the number of deliveries decreases, and instead, the number of products in each delivery increases, which results in a reduction in the costs of the distributor.