An Order-Up-to Inventory Model with Sustainability Consideration

Abstract

Along with growing interest in environmental concerns these days, significant academic efforts have been exerted to incorporate sustainability issues into the existing inventory models except for fixed-review interval (i.e., order-up-to models). In this study, we develop an order-up-to model considering environment-related costs and investigate the value of this new policy over the naïve one. Results of an extensive simulation study reveal that sustainability consideration reduces the total costs and that its value is higher when the mean demand is higher, when demand is more variable, when the costs of transshipment or inventory holding are lower, or when an ordering setup cost or an additional indirect cost of having inventory are higher. These findings fill the research gap in existing literature and contribute to managerial implications for periodic inventory control in practice.

An integrated transportation-inventory model with carbon emission and its impact on the total cost bounds

“…Many nations are implementing measures to minimize this, including carbon taxes, direct and indirect carbon caps, and trade [27]. Meanwhile, the total costs are reduced when sustainability is taken into account [28,29]. This study is concerned with transportation carbon emissions since our problem deals with manufactured product transfer suppliers to customers.…”

Inventory Optimization in Pharmacy Using Inventory Simulation-Based Model During the Covid-19 Pandemic

“…Similar studies have been conducted frequently. Numerous research that combined these two approaches produced substantial findings (Fadhil & Suryani, 2021;Kwak, 2021;Patriarca et al, 2020;Profita, 2017;Utama & Siswanto, 2017). Patriarca et al (2020) and Kwak (2021) carried out inventory planning for perishable products using the EOQ method.…”

“…Numerous research that combined these two approaches produced substantial findings (Fadhil & Suryani, 2021;Kwak, 2021;Patriarca et al, 2020;Profita, 2017;Utama & Siswanto, 2017). Patriarca et al (2020) and Kwak (2021) carried out inventory planning for perishable products using the EOQ method. They integrated it with demand simulation to be able to face high uncertainty and a dynamic market.…”

“…They integrated it with demand simulation to be able to face high uncertainty and a dynamic market. Other studies have carried out inventory control in the health supply chain but did not include quantitative considerations, such as the simulation of future demand (Friday et al, 2021;Kwak, 2021;Patriarca et al, 2020). Some studies above show that it is still very rare for research to use objects similar to this research, with comparisons between inventory and simulation methods to determine the best policy alternatives during the Covid-19 pandemic.…”