Abstract
The research on production, delivery and inventory strategies for perishable products in a two-echelon distribution network integrates the production routing problem (PRP) and two-echelon vehicle routing problem (2E-VRP), which mainly considers the inventory and delivery sustainability of perishable products. The problem investigated in this study is an extension of the basic problems, and it simultaneously optimizes production, replenishment, inventory, and routing decisions for perishable products that will deteriorate over the planning horizon. Additionally, the lead time has been considered in the replenishment echelon, and the unit inventory cost varying with the inventory time is considered in the inventory management. Based on a newly designed model, different inventory strategies are discussed in this study: old first (OF) and fresh first (FF) strategies both for the first echelon and second echelon, for which four propositions to model them are proposed. Then, four valid inequalities, including logical inequalities, a ( ℓ , S , W W ) inequality, and a replenishment-related inequality, are proposed to construct a branch-and-cut algorithm. The computational experiments are conducted to test the efficiency of valid inequalities, branch-and-cut, and policies. Experimental results show that the valid inequalities can effectively increase the relaxed lower bound by 4.80% on average and the branch-and-cut algorithm can significantly reduce the computational time by 58.18% on average when compared to CPLEX in small and medium-sized cases. For the selection of strategy combinations, OF–FF is suggested to be used in priority.
Highlights
With about half of its population undernourished [2]
It is apparent that the time savings of B&C are more significant compared to those of CPLEX; the three inventory strategy combinations can all save computational time compared to optimal policy (OP)–OP; and fresh first (FF)–FF performs best in computational time both by B&C and CPLEX
The formulation and branch-and-cut algorithm were constructed to provide some suggestions for inventory management of perishable products and theoretical guidance for the production, replenishment and distribution planning under the new retail mode
Summary
Considering that the problem studied combines three parts, the literature review is categorized into three streams in order to provide a detailed overview for this topic. The first stream encompasses the development of formulations and algorithms for PRP, which contains 16 papers and contributes to the construction of the first echelon in 2E-PRP. The second stream entails the application and exploration of perishable products in the field of PRP, which encloses 10 papers and mainly focuses on the policies and strategies for sustainability. Note that perishable products have not been considered for 2E-VRP in the current literature. With the combination of related PRP and 2E-VRP problems, this study can explore the production, replenishment and inventory policies and a branch-and-cut algorithm for perishable products in 2E-PRP in a comprehensive way
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