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On the impact of adjusting the minimum life on receipt (MLOR) criterion in food supply chains

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  • Santos, Maria João
  • Martins, Sara
  • Amorim, Pedro
  • Almada-Lobo, Bernardo

Abstract

The Minimum Life on Receipt (MLOR) is a widely used rule that imposes the minimum remaining age a food product must be delivered by the producer to the retailer. In practice, this rule is set by retailers and it is fixed, around 2/3 of the age of products regardless their shelf life. In this work, we study single and two echelon make-to-stock production-inventory problems for fixed-lifetime perishables. Mixed-integer linear optimization models are developed considering the MLOR rule both as decision variable and fixed parameter. When the MLOR rule is a variable, it is considered either a sole decision of the producer or a collaborative decision between retailer and producer. The goal of this work is to compare the supply chain performance considering this innovative setting of optimal MLOR (as a variable) against the traditional setting of fixed MLOR rule. The computational results suggest that allowing flexible MLOR rules according to the shelf life of products and the operational requirements of the producer benefit both entities in the supply chain. In particular, reducing the MLOR requirement in up to 12% does not interfere substantially with the average freshness of products arriving to the retailer, but reduces extensively surplus/waste generation at the producer while keeping a small amount of waste at the retailer.

Suggested Citation

  • Santos, Maria João & Martins, Sara & Amorim, Pedro & Almada-Lobo, Bernardo, 2022. "On the impact of adjusting the minimum life on receipt (MLOR) criterion in food supply chains," Omega, Elsevier, vol. 112(C).
    • Handle: RePEc:eee:jomega:v:112:y:2022:i:c:s0305048322000986
    DOI: 10.1016/j.omega.2022.102691
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    References listed on IDEAS

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    1. Arzum Akkas & Dorothee Honhon, 2023. "Determining maximum shipping age requirements for shelf life and food waste management," Production and Operations Management, Production and Operations Management Society, vol. 32(7), pages 2173-2188, July.

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