Impact of Variable Holding Cost on Two Level Trade Credit Policy for an Optimal Supply Chain Management

Abstract

The supply chain system purpose is to integrate environment thinking with adroit energy consumption into supply chain management (SCM). It involves flexible manufacturing process of the items, more items delivery, optimal energy consumption, and deduced the waste. The manufacturing process may be made much flexible through volume agility. In this case, production of the items can’t be certain, and with the concept of volume agility, production is taken as decision variable under the impact of optimum energy consumption. We consider supplier and producer with two level trade credit policies with optimum consumption. To reduce the total cost, we believe that demand function on selling price. Energy and carbon emission costs introduced in the holding cost, setup cost, ordering cost and items cost for supplier and producer. The supply chain model was established analytically and obtained the optimal decision variable in closed form solution. The optimality of the objective function is being obtained analytically as well as graphically. Sensitivity analysis solved to show the variation in the decision parameters. Finally, the numerical examples are employed to illustrate the present study with marginal insights