An enhanced robust possibilistic programming approach for forward distribution network design with the aim of establishing social justice: A real-world application

Abstract

The business environment, especially in the supply chain, is virtually fluctuating and is entangled with a lot of problems. Accordingly, a tailored mechanism should be adopted to deal with these problems. To do so, supply chains must take precautionary measures such as storing products and holding safety stock, etc. Given the importance of storage in supply chains, warehouses and depots should be carefully taken into account and located in such a way that their best performance is warranted. In this regard, this paper addresses a robust Multi-Objective multi-product model to design a distribution system under operational risks and disruption considerations. In the proposed model, the objective functions include minimizing the total distribution system cost, the total environmental impacts caused by supply chain along with minimizing the maximum lost sales in customer zones, while taking into consideration possible complete multiple disruptions in facilities and routes between them. Besides, a ε-constraint method is utilized to convert the Multi-Objective problem to a single objective model. In this paper, a two-stage robust possibilistic programming approach is deployed to cope with the uncertainty and disruption risks in the proposed model. Eventually, a real automotive case study is applied to the proposed model, via which the applicability and performance of the proposed model are endorsed. Results indicate that considering operational and disruption risks in the supply chain using two-stage robust optimization will require high costs but it will lead to economic savings and technical advantages in the long term.