Reducing the excessive emissions of greenhouse gases such as carbon dioxide is an effective way to achieve a low carbon economy. Many governments have carried out carbon cap-and-trade regulation. This regulation has brought more challenges to the firms' operational management because the firm activities are the main source of carbon emissions. In this scenario, a new inventory optimization problem for deteriorating items is proposed from the perspective of a retailer. The retailer orders a type of deteriorating items from the upstream supplier during a finite time horizon and sells it to customers with a time-varying price. This type of product deteriorates with a constant deterioration rate during the storing process. Moreover, the carbon emissions are generated in the ordering and storing processes. Under the constraint of carbon cap-and-trade regulation, the retailer should determine the optimal number of replenishment cycles, replenishment time and order quantity to maximize his/her total profit. This paper formulates a mixed-integer optimization model for this problem. By analyzing several properties of this model, we solve the optimal solution by using convex optimization method. Further-more,it is compared with the other two replenishment policies of the model without carbon emission consideration and the model with minimizing the carbon emissions. By solving the above thee replenishment policies, the key conditions of attaining higher profit and lower carbon emissions theoretically are cleriued. Finally, numerical analysis is used to illustrate the theoretical results and the effects of some key parameters on the optimal replenishment policy are analyzed. The results show that, the optimal number of replenishment cycles can be uniquely determined to maximize the total profit of the retailer under carbon cap-and-trade regulation; the retailer may obtain higher profit and emit lower carbon emissions when the optimal number of replenishment cycles under cap-and-trade regulation is equals to that of the model with minimizing the carbon emissions; decreasing the length of time horizon or increasing the price of trading carbon emission permit may lead to higher profit and lower carbon emissions. These observations can help firm decision-makers to determine the optimal inventory policy for maximizing his/her profit and reducing carbon emissions. On the other hand, these results can help government policy-makers to determine several feasible carbon parameters in constructing specific carbon emission regulation.
BAI Qing-guo, XU Xian-hao
. Optimal Inventory Policy for Deteriorating Items Under Cap-and-trade Regulation[J]. Chinese Journal of Management Science, 2017
, 25(7)
: 28
-37
.
DOI: 10.16381/j.cnki.issn1003-207x.2017.07.004
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