A Multiple Objective Programming Model for Designing of Supply Chain Network with Efficient Manufacturers and Distributers

Abstract

One of the most important decisions in supply chain network (SCN) design is choosing the optimal location for the facilities. The facilities in SCN have different efficiency according to their locations. In this paper, efficiency of facilities is added to the supply chain network design by using data envelopment analysis model, and a multi-objective model is presented for the design of efficient supply chain network. The proposed model chooses the most appropriate place for manufacturers and distributors thereby decreases the total cost of the supply chain and simultaneously increases the efficiency. The desired supply chain has several raw materials and products, with four layers of suppliers, manufacturers, distributors and customers. The proposed model is locating manufacturers and distributors, and planning the purchase of any suppliers. The results of numerical example show that adding efficiency promotes the supply chain network model. Namely, with regard to the tradeoff between cost and efficiency objectives, SCN design with efficient facilities is better than networks based only on cost objective function.