Production Planning Problem of a Two-Level Supply Chain with Production-Time-Dependent Products

Abstract

This study considers a production planning problem with a two-level supply chain consisting of multiple suppliers and a manufacturing plant. Each supplier that consists of multiple production lines can produce several types of semi-finished products, and the manufacturing plant produces the finished products using the semi-finished products from the suppliers to meet dynamic demands. In the suppliers, different types of semi-finished products can be produced in the same batch, and products in the same batch can only be started simultaneously (at the same time) even if they complete at different times. The purpose of this study is to determine the selection of suppliers and their production lines for the production of semi-finished products for each period of a given planning horizon, and the objective is to minimize total costs associated with the supply chain during the whole planning horizon. To solve this problem, we suggest a mixed integer programming model and a heuristic algorithm. To verify performance of the algorithm, a series of tests are conducted on a number of instances, and the results are presented.