An Integrated Three-echelon Inventory Model And Empiricalanalysis Based On Distribution Center

With the rapidly development of e-commerce, there are many different kinds ofsales models of commodity. Most people buy foodstuffs online, especially fresh foodsand frozen products. However, many practical problems arise as the growing demandfor cold chain items, such as the food safety problems, which need the government toimprove the developing specifications and operation modes of cold-chain logistics,strengthen the construction of logistics facilities and enhance the techniques and skillsof cold-chain logistics. Only in this way, we can ensure the cold chain is executedthroughout the entire supply chain and the food is safe for consumption.However, the situation of cold-chain logistics in China is not going well,especially in the aspect of the operation modes of cold-chain logistics. The perishableproducts supply chain is mainly the two-echelon supply chain with a single-vendorand a single-buyer where the logistics activities are implemented by each enterprise insupply chain compared with developed countries. This model can’t meet the demandof promote the core competence. Meanwhile, it wastes the resource of corporationlogistics.Therefore, the study will contribute to the promotion of core competence ofenterprise and the overall competitiveness of the supply chain when introduce thedistribution center and the concept of integration to the study of multi-echeloninventory for cold chain items.This article establishes an integrated cold chain inventory model which containsmulti-manufacturer, a distribution center and multi-retailer in a finite horizon to findthe optimal order quantity assuming that deterioration rate is a three-parameterWeibull distribution and DC could provides a value-added service. The results ofnumerical example which used the Genetic Algorithms showed that the three-echeloninventory system based on DC is better than the traditional two-echelon supply chain.