Application of linear programming in supply chain management in the foundry

Abstract

This article addresses the problem of supply chain management in the foundry industry. In the case of manufacturing companies assisting in the production process by external entities, it is important to consider cooperation starting from the settlement of raw materials or semi-finished products to the acceptance of production from a subcontractor along with the registration of the costs of service, transport and storage. Subcontractor's production plans should be included in the operational production schedule. The article solves a specific problem regarding cooperation with suppliers of alloying elements for the production of cast iron. A cast production, transport and storage plan has been developed so that the total costs of production, transport and storage are as low as possible. A mathematical model was formulated for this problem. An algorithm is presented to solve the problem of supplier selection. The proposed analysis is the starting point for an efficient business planning process, where it is required to transform information from various areas (sales, marketing and business partners) into a common set of planning data and indicators.