Multi-Echelon Inventory Optimization for Fresh Produce

For fresh produce, product freshness is very critical in satisfying customers and reducing obsolescent cost. While network nodes in a supply chain add more “touch” of inventories, they also reduce safety stock through a risk pooling effect. Our project studied relevant factors and created a predictive model to quantify the impact of adding an fulfillment center to the supply chain. We found that products with high demand volatility would stay in the supply chain a shorter time, with an fulfillment center, resulting in better freshness.

Authors: Saran Limvorasak and Zhiheng Xu
Advisor: Dr. Francisco J. Jauffred