Modeling the SBC Tanzania Production-Distribution Logistics Network

Abstract

The increase in customer expectation in terms of cost and services rendered, coupled with competitive business environment and uncertainty in cost of raw materials have posed challenges on effective supply chain engineering  making it essential to do cost-benefit analysis before making final decisions on production-distribution logistics. This paper provides a conceptual model that provide guidance in supply chain decision making for business expansion. It presents a mathematical model for production-distribution of an integrated supply chain derived from current operations of SBC Tanzania Ltd which is a major supply chain that manages products' distribution in whole of Tanzania. In addition to finding the optimal cost, we also carried out a sensitivity analysis on the model so as to find ways in which the company can expand at optimal cost, while meeting customers' demands. Genetic algorithms is used to run the simulation for their efficient in solving combinatorial problems.

Key words: Business environment, supply chain engineering, production-distribution, genetic algorithms, optimal cost.