A Green Supply Chain Design Model Considering Lead Times

Lead times and carbon emissions are important factors for the design of supply chain networks since companies’ customers and various other stakeholders are getting more and more sensitive regarding both performance factors. In order to reduce lead times, companies apply different strategies like e.g. using faster logistic modes, locate production facilities and warehouses near customers or keep goods at stock. Nevertheless, these measures can have a high impact on both costs and carbon emissions. This paper provides a multi-layer, multi-product and multi-period supply chain design approach with a carbon cap-and-trade system considering lead times. The bi-objective model aims to minimize delivery lead time and discounted total costs. Furthermore, it is possible to keep units on stock and carbon emissions for all necessary processes to fulfill customer demand are taken into account. A computational study evaluates the solvability of the model and gives insight on the influence of delivery lead time and prices of carbon credits on the configuration of a supply chain.