Incorporating logistic costs into a single vendor–buyer JELS model

Mohd Nizam Ab Rahman, Raden Achmad Chairdino Leuveano, Fairul Azni bin Jafar, Chairul Saleh, Baba Md Deros, Wan Mohd Faizal Wan Mahmood, Wan Hasrulnizzam Wan Mahmood

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

Inventory replenishment decisions in supply chains usually benefit from economies of scale to minimize logistics costs; however, this approach may create a conflict between truckload utilization and economic ordering decisions. This paper proposes two Joint Economic Lot Size models that incorporate logistic costs (a function of shipping weight and distance) with two transportation modes: truckload (TL) and less-than-truckload (LTL) shipments. Additionally, a heuristic model is proposed to provide the solution when the mode of transportation is limited to TL and LTL shipments. The procedures for solving each model are developed based on two challenges in transportation: incapacitated shipments and capacitated shipments. Moreover, numerical examples are given to illustrate the proposed models based on four aspects: total costs, order quantity, the number of deliveries, and production batch quantity. The three proposed models are subsequently compared to reveal results for managers to consider for improving the performance of their supply chain.

Original languageEnglish
Pages (from-to)1339-1351
Number of pages13
JournalApplied Mathematical Modelling
Volume40
Issue number23-24
DOIs
Publication statusPublished - 1 Dec 2016

Fingerprint

Logistics
Costs
Supply Chain
Supply chains
Economics
Lot Size
Model
Batch
Freight transportation
Heuristics
Model-based
Minimise
Managers
Numerical Examples

Keywords

  • Costs
  • Inventory
  • Joint Economic Lot Size
  • Logistic

ASJC Scopus subject areas

  • Modelling and Simulation
  • Applied Mathematics

Cite this

Incorporating logistic costs into a single vendor–buyer JELS model. / Ab Rahman, Mohd Nizam; Leuveano, Raden Achmad Chairdino; Jafar, Fairul Azni bin; Saleh, Chairul; Md Deros, Baba; Wan Mahmood, Wan Mohd Faizal; Mahmood, Wan Hasrulnizzam Wan.

In: Applied Mathematical Modelling, Vol. 40, No. 23-24, 01.12.2016, p. 1339-1351.

Research output: Contribution to journalArticle

Ab Rahman, Mohd Nizam ; Leuveano, Raden Achmad Chairdino ; Jafar, Fairul Azni bin ; Saleh, Chairul ; Md Deros, Baba ; Wan Mahmood, Wan Mohd Faizal ; Mahmood, Wan Hasrulnizzam Wan. / Incorporating logistic costs into a single vendor–buyer JELS model. In: Applied Mathematical Modelling. 2016 ; Vol. 40, No. 23-24. pp. 1339-1351.
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