A sustainable inventory model: integrating eco-packaging, advertising, and pricing strategies under carbon tax policies

Neha Rani (), Sumit Maheshwari () and Manoj Kumar Sharma ()
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Neha Rani: Uttaranchal University
Sumit Maheshwari: Indian Institute of Technology Bombay
Manoj Kumar Sharma: Uttaranchal University

International Journal of System Assurance Engineering and Management, 2025, vol. 16, issue 3, No 23, 1339-1356

Abstract: Abstract This paper presents a sustainable inventory model that incorporates environmentally friendly packaging, advertising, and pricing strategies within the framework of carbon tax regulations. This model investigates the environmental consequences of traditional inventory management by analyzing the influence of sustainable packaging on consumer demand and the promotion of eco-conscious behaviors through targeted advertising. This study investigates the impact of advertising emphasizing sustainability on improving brand reputation and appealing to environmentally conscious consumers. The analysis focuses on the main factors contributing to carbon emissions in the inventory system, including transshipments and inventory holding. The carbon tax policy is a versatile and efficient strategy for mitigating these emissions. The model aims to maximize net profit by identifying the optimal ordering cycle, sales price, and advertising frequency. Decision variables are computed using conventional optimization methods, and the Hessian matrix algorithm verifies their global optimality. The numerical example and sensitivity analysis establish the model’s validity, offering significant managerial insights and strengthening the model’s robustness. Graphical demonstrations of optimality are shown using Mathematica version 13.2.0. The findings indicate that the suggested model surpasses current frameworks, emphasizing the advantages of including sustainability principles in inventory management procedures. When effectively implemented, sustainable packaging enhances overall organizational performance and contributes to achieving strategic objectives. Graphical abstract

Keywords: Optimization; Sustainability; Inventory control; Variable demand (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s13198-024-02644-w

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