An integrated production planning and inventory management problem for a perishable product: optimization and Monte Carlo simulation as a tool for planning in scenarios with uncertain demands

Jeferson Auto da Cruz (), Luiz Leduino de Salles-Neto () and Cleder Marcos Schenekemberg ()
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Jeferson Auto da Cruz: Federal Institute of São Paulo (IFSP)
Luiz Leduino de Salles-Neto: Federal University of São Paulo (UNIFESP)
Cleder Marcos Schenekemberg: Federal University of São Paulo (UNIFESP)

TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, 2024, vol. 32, issue 2, No 5, 263-303

Abstract: Abstract This paper addresses a novel problem inspired by a practical situation faced by a Brazilian dairy company, which presents the integration of production and a two-level storage inventory control. In the supply chain (SC) analyzed, multiple production plants, warehouses, and distribution centers are considered. The problem also involves a set of constraints related to logistical capabilities and conditions of material flow throughout the SC. We developed a mathematical model and a Monte Carlo Simulation routine that aims to assist managers in establishing a production and inventory management plan for a perishable product, considering a stochastic and non-stationary demand. A numerical illustration of the results obtained by the mathematical model and a case study are carried out on the consideration of a First-Expired, First-Out inventory management policy. Results demonstrate that the proposed method allows the analysis of safety stock and the achievement of desired service levels while promoting a reduced rate of food waste over the considered planning horizon.

Keywords: Perishable product; Optimization; Supply chain management; Monte Carlo simulation; Two storage levels; FEFO; 90C70 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11750-024-00667-x

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