Three-Echelon Green Supply Chain Inventory Decision for Imperfect Quality Deteriorating Items


  • Yosef Daryanto1 (Universitas Atma Jaya Yogyakarta, Indonesia)
  • Hui Ming Wee1 (Chung Yuan Christian University, Taiwan)

This paper presents an integrated supply chain inventory model for deteriorating items with an imperfect quality considering its environmental impact, particularly the supply chain carbon footprint. An imperfect production system produces a certain number of defective items. Therefore, in our model, the manufacturer conducts a 100% quality check to prevent the delivery of defective items. A third-party logistics (3PL) company supports the logistics between the manufacturer and the buyer, by transporting the products from the manufacturer to a warehouse and then delivering the products in a smaller quantity to the buyer. The proposed solution procedure determines the number of deliveries per cycle, delivery interval, and delivery quantity between the 3PL and the buyer simultaneously. It also determines the production quantity of the manufacturer and the delivery quantity from the manufacturer to the 3PL. The objective is to minimize the expected total cost and to reduce total carbon emissions.

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