TITLE: A Replenishment Policy for Perishables with Cold Chain Transportation and Lead Time Reduction Options
by Atahan Bayır, M.S. in Industrial Engineering
Advisor: Professor Ülkü Gürler
Date & Time: July 26, 2023 Wednesday at 10:00
Place: EA – 409
Perishability relates to products that have limited shelf life and are prone to spoilage, decay, or becoming unsafe for use over time. In this thesis, we consider the inventory replenishment of perishable products. Although perishability is a common aspect in several product categories such as fresh produce, pharmaceuticals, blood product and fashion industry, most of the existing inventory models assume that products have an infinite shelf life. In this work we introduce a novel approach that integrates inventory replenishment and cold chain investment decisions to the replenishment policy of inventories with the aim of better preserving the effective lifespan of the products. We focus on a single product, single location, continuous review inventory model with positive lead time, where the products have fixed lifetimes. We assume that a cold chain investment is available to keep the items in a preservative environment during the lead time, thereby slowing down the aging process. In particular, we adapt a modified reorder-point/order-quantity policy that allows for a cold chain investment. The model also allows a scenario where the lead time is reduced through expedited transportation, which reduces both the aging and the time when the orders are added to the inventory. The objective is to minimize the expected cost per unit time over an infinite horizon with the decision variables of order quantity, reorder level, and cold chain investment amount. A numerical study is provided to demonstrate the model performance, its sensitivity to system parameters, comparison with benchmarks and the impact of perishability.
Atahan Bayır received his B.S, and graduated with High Honors from the Department of Industrial Engineering at Bilkent University. He is currently pursuing a M.S. degree in the same department and is working with Prof. Ülkü Gürler on a replenishment policy for perishables with cold chain transportation. Besides, his research interest includes stochastic processes.