Assessment of centralised and localised ice cream supply chains using neighbourhood flow configuration models

Abstract

Traditional food supply chains are often centralised and global in nature, entailing substantial resource consumption. However, in the face of growing demand for sustainability, this strategy faces significant challenges. Adoption of localised supply chains is deemed a more sustainable option, yet its efficacy requires verification. Supply chain analytics methodologies provide invaluable tools to guide decisions regarding inventory management, demand forecasting and distribution optimisation. These solutions not only enhance facilitate operational efficiency, but also pave the way for cost reduction, further aligning with sustainability objectives. This research introduces a novel decision-making approach anchored in mixed integer linear programming (MILP) and neighbourhood flow models defined in cellular automata to compare the environmental benefits and vulnerability to disruption of these two chain configurations. Additionally, a comprehensive cost analysis is integrated to assess the economic feasibility of incorporating layout changes that enhance supply chain sustainability. The proposed framework is applied on an ice cream supply chain across England over a one-year timeframe. The findings indicate the superiority of the localised configuration in terms of economic benefits, leading to savings exceeding £ 1 million, alongside important reductions in environmental impact. However, in terms of resilience, the traditional configuration remains superior in three out of the four examined scenarios.

Keywords

• Supply chain management
• Flow configuration model
• Ice cream
• Mixed integer linear programming (MILP)