Sustainable Distribution and Inventory Planning in Supply Chains under the VMI Strategy for B2B and B2C Models Using IoT

Document Type : Research Paper

Authors

1 1Department of Industrial Engineering, Faculty of Engineering, Alzahra University, Tehran, Iran

2 Department of Industrial Engineering, Faculty of Engineering, Kharazmi University, Tehran, Iran

10.22070/jqepo.2025.19895.1291

Abstract

This study explores optimizing sustainable supply chains by integrating vendor-managed inventory (VMI) and internet of things (IoT). The research focuses on business-to-business (B2B) and business-to-customer (B2C) models. While VMI is widely studied in B2B, its B2C application remains limited. This study examines the tire manufacturing sector, addressing significant environmental and safety concerns. A multi-level optimization framework is introduced to minimize costs, to reduce carbon emissions and waste, and to enhance customer safety. Customer safety is introduced as a novel social factor. The Density-Based Spatial clustering of applications with noise (DBSCAN) algorithm clusters retailers, improving efficiency and reducing computational time. The framework serves very important customers under the VMI strategy, while normal customers are excluded. Empirical data from a tire manufacturer validates the framework using Gurobi optimization package. Results demonstrate that applying VMI to all customers significantly increases service levels and objective function. Conversely, restricting VMI to B2B customers causes a drop in service levels and a decline in the objective function. Results confirm the scalability and efficiency of the model, with sensitivity analysis showing strong performance under changing the model parameters. This paper explores VMI in B2B and B2C models, offering insights into sustainable supply chain management.
Journal of Quality Engineering and Production Optimization

Articles in Press, Accepted Manuscript
Available Online from 13 May 2025

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