Sustainable Supply Chain and Transportation Networks

In this paper, we show how sustainable supply chains can be transformed into and studied as transportation networks. Specifically, we develop a new supply chain model in which the manufacturers can produce the homogeneous product in different manufacturing plants with associated distinct environmental emissions. We assume that the manufacturers, the retailers with which they transact, as well as the consumers at the demand markets for the product are multicriteria decision-makers with the environmental criteria weighted distinctly by the different decision-makers. We derive the optimality conditions and the equilibrium conditions, which are then shown to satisfy a variational inequality problem. We prove that the supply chain model with environmental concerns can be reformulated and solved as an elastic demand transportation network equilibrium problem. Numerical supply chain examples are presented for illustration purposes. This paper, hence, begins the construction of a bridge between sustainable supply chains and transportation networks.