Product Channeling in an O2O Supply Chain Management as Power Transmission in Electric Power Distribution Systems

Abstract

With the aim of delivering goods and services to customers, optimal delivery channel selection is a significant part of supply chain management. Several heuristics have been developed to solve the variants of distribution center allocation and vehicle routing problems. In reality, small-scale suppliers cannot afford research and development departments to optimize their distribution networks. In this context, this research work develops a model for an online to offline (O2O) supply chain management network of a small-scale household electric components manufacturer for delivering goods to its distribution centers and retailers. Retailers are acquired by the company through investment in the O2O channel of e-commerce. Electric power transmission and distribution is considered as representative of the product distribution network. A model is developed using a combination of the supply chain management technique and power transmission terminologies. The constrained linear programming model is solved through the linear programming tool of the LINGO optimization software and the global optimum results for the proposed quantity allocation problem are achieved. A numerical experiment is provided to illustrate the practical applicability of the model and the optimal results are analyzed for model robustness.

Keywords

• supply chain management
• e-commerce
• O2O channel
• customer acquisition cost
• transshipments
• electric power distribution