An Integrated Two-Echelon Supply Chain Inventory Model with Trade Credit, Product Deterioration and Carbon Emissions

Abstract

This research aims to develop a sustainable supply chain framework that integrates energy-efficient practices with environmental responsibility. We investigate a two-echelon green supply chain, considering factors such as carbon emissions from waste disposal, product deterioration, transportation, and manufacturing processes. By implementing preservation technologies, product deterioration rates can be effectively mitigated. The supply chain model incorporates a credit period offered by the manufacturer to the supplier, who in turn offers a credit period to the retailer, serving as a competitive advantage to drive sales growth. This study extends the traditional two-echelon supply chain model by incorporating controllable deterioration, waste, and carbon emissions. An analytical solution is derived to optimize timing and preservation technology cost, yielding optimal results. A comprehensive numerical analysis and sensitivity analysis validate the proposed model, demonstrating its convexity through analytical and graphical representations. The primary objectives are to minimize overall carbon emissions and total cost. The proposed model offers a practical framework for optimizing supply chain integration, reducing costs, and minimizing carbon footprint.