An Integrated Optimization Model of Green Supply Chain Network Design with Inventory Management

Lingyun Zhou, Dezhi Zhang (), Shuangyan Li and Xiangyu Luo
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Lingyun Zhou: Transportation & Economics Research Institute, China Academy of Railway Sciences Corporation Limited, Beijing 100081, China
Dezhi Zhang: School of Traffic and Transportation Engineering, Central South University, Changsha 410075, China
Shuangyan Li: College of Logistics and Transportation, Central South University of Forestry and Technology, Changsha 410004, China
Xiangyu Luo: School of Traffic and Transportation Engineering, Central South University, Changsha 410075, China

Sustainability, 2023, vol. 15, issue 16, 1-24

Abstract: Supply chain network design and inventory management are both significant for improving the core competitiveness of enterprises. This study investigates the joint optimization problem of facility locations and inventory for assembly manufacturing enterprises’ multi-echelon supply chain networks, considering the locations of facilities, the selection of suppliers, transport mode choices, and inventory decisions simultaneously. A corresponding integrated optimization model is proposed, which aims to minimize the total cost, consisting of the fixed open cost of facilities, the inventory cost of the open plants and distribution centers, and the transportation cost of vehicles in the entire supply chain network as well as the cost of CO 2 emissions. Based on the characteristics of the proposed optimization model, a hybrid genetic algorithm embedded with a local search is developed to solve the proposed model. Numerical examples and a case study are provided to illustrate the effectiveness of the proposed model and the corresponding algorithm. The findings show that the model is reasonable and applicable, and hybrid genetic algorithm (HGA) is more efficient than the standard genetic algorithm (SGA). In addition, plants’ maximum lead-time has a significant impact on the total cost of the supply chain.

Keywords: green supply chain; network design; joint optimization model; location-inventory; selection of suppliers; transport modes choice; hybrid genetic algorithm (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
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