Strategic risk management in the stocking decisions of frozen vegetables

Yenming J. Chen, Tzong-Ru Lee, Yaqian Xiao, Miaohua Lin and Yunxuan Li

International Journal of Logistics Economics and Globalisation, 2018, vol. 7, issue 3, 268-276

Abstract: Many crops are harvested once a year and the produces will meet the requirements of the entire year. For example, carrots usually harvest in winter and most of them must be refrigerated to fulfil the annual demands. The remains are then released to the fresh auction market. The refrigerated vegetables will be carefully released to the market month by month according to the expected demand of the entire year. In this study, simulated optimisation analysis is carried out based on a design of experiments. Results show that: 1) the higher the probability of the natural disease in the future, the more the hoarding; 2) when substitutive vegetables are expected to be scarce, the hoarding should increase; 3) when the quality of this batch of harvest is worse, then the hoarding should decrease. Our simulation results show that profit reaches the highest if natural shipments are 40,000 t.

Keywords: root vegetables; frozen hoarding; simulated optimisation; annual harvest; uncertain demand; substitutive produces; supply-demand balance. (search for similar items in EconPapers)
Date: 2018
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