Food supply, safety and quality have become major concerns worldwide. Agri-food supply chains (ASC) possess special characteristics due to the perishability of their products and the high uncertainty of supply and demand. Furthermore, different sources of CO 2 emissions exist in an ASC due to storage, transportation, and disposal of fresh produce. Thus to ensure the sustainability of the supply chain, planning decisions have to be made with consideration of both economic and environmental aspects. This work studies the effect of changing the order quantity in a two-echelon agri-food supply chain on costs, emissions, and service level. A discrete-event simulation model is developed to include stochastic demand and lead-time, the amount of CO 2 emissions along the supply chain, service levels, and product lifetime effects. Simulation results show that reducing the order quantities can reduce costs and emissions by 27.42 % and 18.21 %; respectively, without sacrificing high service levels. Also, relying on costs or service level as sole objectives of the supply chain without consideration of emissions can result in greater economic and environmental inefficiencies in management of inventory levels.

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Abstract:This paper develops and tests a novel extension to traditional supplier selection practice, with a particular focus on the concluding stages of a manufacturing based field service. Action based research was used to design and develop a discrete event simulation (DES) decision support for a large multinational manufacturing organisation with a significant after sales service supply chain.The framework has been designed to identify and validate the value attributable to collaborative supplier contracting with built in costed performance improvement targets. Use of the framework in the case organization was found to produce greater cost savings over traditional practice, facilitating extended supply chain contracts. The results provide evidence of the high level of savings achievable whilst also improving customer delivery through targeted service improvements over the contracts life cycle. This framework advances beyond the prevalent practice of cost focused short term adversarial supply contracting and is innovative in terms of its continuous improvement simulation based framework design.

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