Discrete event simulation as a strategic decision instrument for a CO₂– and cost-efficient distribution chain applied in the FMCG sector

Abstract

Globalization leads to growing distribution distances in logistics. This increases the cost- and energy-related effort for the transportation of goods. As a consequence, companies need to react to ensure their competitiveness, in the best case already in the strategic planning of the distribution chain. Due to the fact that the distribution chain is a complex and dynamic network, it is difficult to reach adequate results with analytic methods. Discrete event simulation is an approach to achieve results that consider the dynamics of the system. In this paper, it is discussed how discrete event simulation is suitable for the strategic design of the distribution concerning an optimal exploitation of CO₂ emissions, costs and service level applied for a case in the food sector. This has been realized by application-oriented scenarios in the context of a European project called e-SAVE that came out in the course of the seventh framework program (FP7). With the simulation approach, various distribution chain scenarios have been modelled, beginning with two independent distribution chains and later with various design alternatives with an increasing merging level. Finally, the results have been compared and evaluated concerning the impact of the factors given above, in order to identify the most CO₂- and cost-efficient alternative. As assessment instrument the discrete event simulation tool SimChain has been utilized. In this context, the data model of the tool and several features of the implemented building blocks have been amended with respect to the requirements of the distribution scenarios.

Keywords:

• CO₂ efficiency
• discrete event simulation
• distribution chain

Acknowledgement

This project has received funding from the European Union′s Seventh Framework Programme for research, technological development and demonstration under grant no “288585”.