EURO 2024 Copenhagen
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641. A novel competitive model for production and distribution planning of deteriorating products under uncertainty: a case study

Invited abstract in session MB-50: Retail Inventory Management I, stream Retail Operations.

Monday, 10:30-12:00
Room: M2 (building: 101)

Authors (first author is the speaker)

1. Adel Aazami
Institute of Transport and Logistics Management, Department of Global Business and Trade, Vienna University of Economics and Business
2. Sebastian Kummer
Institute of Transport and Logistics Management, Vienna University of Business and Economics

Abstract

This paper develops a new robust optimization model for production and distribution planning considering competition among supply chains. The model maximizes the profit of a production and distribution corporation providing deteriorating products. The corporation's market share is enhanced by concentrating on freshness, some encouraging policies, and competitive characteristics. The model considers price, distance, and service level the most critical competitive characteristics. Regarding these characteristics, Huff's gravity model is developed to assess retailers' behavior better and compute market share rightly. Therefore, a mixture of compensatory and non-compensatory approaches considering the comparative attractiveness associated with each characteristic is devised to estimate the final utility of the regarded corporation for the retailers. Also, a robust optimization method is used to cope with the uncertainty. Due to the NP-hardness of the problem, an adaptive large neighborhood search algorithm is suggested. The model's performance is analyzed by solving a real-world industrial case study. Based on the computational examination, employing this study can seriously increase the corporation's profit by improving its market share.

Keywords

Status: accepted

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