An integrated strategic-operational supply chain network design: a case of consumer goods supply chain

Abstract

This study is motivated by a real-world supply chain that expects unprecedented high demand for some of its products. The fast-moving consumer goods supply chain under study is characterised by a large number of supply points (manufacturing plants) and a limited number of warehouses. It operates under the 'avoidance of missed demand' policy. The aim of this research is to develop a large-scale supply chain model that can enable supply chain managers in general and the manager of this supply chain in particular, to function under various circumstances. The model is formulated using mixed integer linear programming (MILP). The proposed model is verified and validated to assure accuracy and credibility. Model verification is done by the aid of data generated for supply chain networks with different sizes using MATLAB software. Validation of the model's assumptions, structure and objective is done through intensive discussion with supply chain experts from industry and academia. The paper discusses managerial and practical implications of the model.