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Trade-off between service time and carbon emissions for safety stock placement in multi-echelon supply chains

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  • Wenjun Ni
  • Jia Shu

Abstract

With the low-carbon revolution, many firms face the continuous challenge for reducing carbon emissions in their supply chain activities. Built upon the strategic safety stock placement model, in this paper, we model the carbon emissions for each stage of a multi-echelon supply chain as a function of the service time guaranteed by this stage to its immediate downstream stages. We establish that there is a negative correlation between service time and carbon emissions at each stage. Based on this, we develop two models to study the trade-off between service time and carbon emissions for safety stock placement in multi-echelon supply chains by considering carbon cap and carbon tax, respectively. Both of them are solved using iterative piecewise linear approximations. We implement these two models to study how carbon cap, carbon emission cost rate and guaranteed service time affect the optimal safety stock placement using a real chain.

Suggested Citation

  • Wenjun Ni & Jia Shu, 2015. "Trade-off between service time and carbon emissions for safety stock placement in multi-echelon supply chains," International Journal of Production Research, Taylor & Francis Journals, vol. 53(22), pages 6701-6718, November.
    • Handle: RePEc:taf:tprsxx:v:53:y:2015:i:22:p:6701-6718
    DOI: 10.1080/00207543.2015.1056319
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    Cited by:

    1. de Kok, Ton & Grob, Christopher & Laumanns, Marco & Minner, Stefan & Rambau, Jörg & Schade, Konrad, 2018. "A typology and literature review on stochastic multi-echelon inventory models," European Journal of Operational Research, Elsevier, vol. 269(3), pages 955-983.
    2. Zhitao Xu & Adel Elomri & Shaligram Pokharel & Fatih Mutlu, 2019. "The Design of Green Supply Chains under Carbon Policies: A Literature Review of Quantitative Models," Sustainability, MDPI, vol. 11(11), pages 1-20, May.
    3. Cao, Cejun & Liu, Yang & Tang, Ou & Gao, Xuehong, 2021. "A fuzzy bi-level optimization model for multi-period post-disaster relief distribution in sustainable humanitarian supply chains," International Journal of Production Economics, Elsevier, vol. 235(C).
    4. Ding, Yi & Gao, Xing & Huang, Chao & Shu, Jia & Yang, Donghui, 2018. "Service competition in an online duopoly market," Omega, Elsevier, vol. 77(C), pages 58-72.
    5. Tsai-Chi Kuo & Ming-Lang Tseng & Hsiao-Min Chen & Ping-Shun Chen & Po-Chen Chang, 2018. "Design and Analysis of Supply Chain Networks with Low Carbon Emissions," Computational Economics, Springer;Society for Computational Economics, vol. 52(4), pages 1353-1374, December.
    6. Eruguz, Ayse Sena & Sahin, Evren & Jemai, Zied & Dallery, Yves, 2016. "A comprehensive survey of guaranteed-service models for multi-echelon inventory optimization," International Journal of Production Economics, Elsevier, vol. 172(C), pages 110-125.

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