A novel fuzzy finite-horizon economic lot and delivery scheduling model with sequence-dependent setups

Abstract

AbstractThis paper addresses the economic lot and delivery scheduling problem (ELDSP) within three-echelon supply chains, focusing on the complexities of demand uncertainty, limited shelf-life of products, and sequence-dependency of setups. We develop a novel mixed-integer non-linear programming (MINLP) model for a supply chain comprising one supplier, multiple manufacturers with flexible flow shop (FFS) production systems, and multiple retailers, all operating over a finite planning horizon. The common cycle (CC) strategy is adopted as the synchronization policy. Our model employs fuzzy set theory, particularly the “Me measure,” to effectively handle the retailers’ demand uncertainty. Our findings indicate that total supply chain costs escalate with an increase in demand, final components’ holding costs, and sequence-dependent setup costs, but decrease with increasing production rates. Furthermore, while total costs are significantly sensitive to changes in demand, they are relatively insensitive to fluctuations in sequence-dependent setup times. The models developed offer valuable managerial insights for optimizing costs in synchronized multi-stage supply chains, aiding managers in making informed decisions about production lot sizes and delivery schedules under both deterministic and fuzzy demand scenarios. Additionally, the proposed models bridge key research gaps and provide robust decision-making tools for cost optimization, enhancing supply chain synchronization in practical settings.