IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i19p12920-d937886.html
   My bibliography  Save this article

Location of the Intermediate Echelon to Add Purchase Value and Sustainability Criteria in a Mining Supply Network

Author

Listed:
  • Rodrigo Barraza

    (Department of Industrial Engineering, Universidad de Santiago de Chile, Santiago 9160000, Chile
    School of Industrial Engineering, Universidad Santo Tomás, Santiago 8370003, Chile)

  • Juan M. Sepúlveda

    (Department of Industrial Engineering, Universidad de Santiago de Chile, Santiago 9160000, Chile)

  • Ivan Derpich

    (Department of Industrial Engineering, Universidad de Santiago de Chile, Santiago 9160000, Chile)

Abstract

This study presents an operational analysis to determine the location of an intermediate hub in a supply network for the mining industry, incorporating sustainability criteria through an optimization model. The sector of small, medium, and artisan mining enterprises (PAMMA), in Chile, has the same pressure as large mining to meet the demands of sustainability in the medium term, but the network of PAMMA facilities is precarious and requires government support for development. One strategy to improve the supply network is to locate intermediate points with limited capacities (called purchasing powers) to help the viability of the business model by incorporating sustainability objectives, such as diminishing the movement of minerals, as well as reducing the carbon footprint and gas emissions, all in support the promotion of the activity of small miners. In order to achieve the strategy above, a mathematical model of location and sustainable capacity is proposed. A grouping of suppliers was carried out to establish the number of mining suppliers in each cluster and the location of the intermediate hubs. Then, the prioritization of the parameters and classification of the processing plant alternatives was performed to define a vector of weights to rank the degree of sustainability. A sustainability matrix was calculated on the basis of the distances and transportation costs between the supplier hubs of the supply network and the processing plants. With each of these factors, a capacity model was developed to validate the mineral process flows in the supply network and estimate the expected productivity levels. The model is intended to support operational decision making when determining the location of an intermediate purchasing power that reduces the impact of transportation costs and emissions. The model was applied in a case study of the supply network in the small mining sector in Chile. The results recommend the location of hubs to add value and encourage investment in the PAMMA supply network.

Suggested Citation

  • Rodrigo Barraza & Juan M. Sepúlveda & Ivan Derpich, 2022. "Location of the Intermediate Echelon to Add Purchase Value and Sustainability Criteria in a Mining Supply Network," Sustainability, MDPI, vol. 14(19), pages 1-14, October.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:19:p:12920-:d:937886
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/19/12920/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/19/12920/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. David Humphreys, 2019. "The mining industry after the boom," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 32(2), pages 145-151, July.
    2. Pietro Giovanni & Georges Zaccour, 2019. "A selective survey of game-theoretic models of closed-loop supply chains," 4OR, Springer, vol. 17(1), pages 1-44, March.
    3. Gérard Gaudet & Ngo Van Long & Antoine Soubeyran, 1999. "Upstream-Downstream Specialization by Integrated Firms in a Partially Integrated Industry," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 14(4), pages 321-335, June.
    4. Hosseini, Seyedmohsen & Ivanov, Dmitry & Dolgui, Alexandre, 2019. "Review of quantitative methods for supply chain resilience analysis," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 125(C), pages 285-307.
    5. Niero, Monia & Olsen, Stig Irving, 2016. "Circular economy: To be or not to be in a closed product loop? A Life Cycle Assessment of aluminium cans with inclusion of alloying elements," Resources, Conservation & Recycling, Elsevier, vol. 114(C), pages 18-31.
    6. Govindan, Kannan & Soleimani, Hamed & Kannan, Devika, 2015. "Reverse logistics and closed-loop supply chain: A comprehensive review to explore the future," European Journal of Operational Research, Elsevier, vol. 240(3), pages 603-626.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pietro De Giovanni & Georges Zaccour, 2022. "A selective survey of game-theoretic models of closed-loop supply chains," Annals of Operations Research, Springer, vol. 314(1), pages 77-116, July.
    2. Manju Saroha & Dixit Garg & Sunil Luthra, 2022. "Analyzing the circular supply chain management performance measurement framework: the modified balanced scorecard technique," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 13(2), pages 951-960, June.
    3. Ehsan Shekarian & Simme Douwe Flapper, 2021. "Analyzing the Structure of Closed-Loop Supply Chains: A Game Theory Perspective," Sustainability, MDPI, vol. 13(3), pages 1-32, January.
    4. Luttiely Santos Oliveira & Ricardo Luiz Machado, 2021. "Application of optimization methods in the closed-loop supply chain: a literature review," Journal of Combinatorial Optimization, Springer, vol. 41(2), pages 357-400, February.
    5. Wu, Cheng-Han, 2021. "A dynamic perspective of government intervention in a competitive closed-loop supply chain," European Journal of Operational Research, Elsevier, vol. 294(1), pages 122-137.
    6. Assarzadegan, Parisa & Rasti-Barzoki, Morteza, 2020. "A game theoretic approach for pricing under a return policy and a money back guarantee in a closed loop supply chain," International Journal of Production Economics, Elsevier, vol. 222(C).
    7. Huihui Liu & Xiaohang Yue & Hui Ding & G. Keong Leong, 2017. "Optimal Remanufacturing Certification Contracts in the Electrical and Electronic Industry," Sustainability, MDPI, vol. 9(4), pages 1-17, March.
    8. Yang, Hui & Chen, Jing & Chen, Xu & Chen, Bintong, 2017. "The impact of customer returns in a supply chain with a common retailer," European Journal of Operational Research, Elsevier, vol. 256(1), pages 139-150.
    9. Bo Wang & Ning Wang, 2022. "Decision Models for a Dual-Recycling Channel Reverse Supply Chain with Consumer Strategic Behavior," Sustainability, MDPI, vol. 14(17), pages 1-18, August.
    10. Zhiguo Wang & Lufei Huang & Cici Xiao He, 2021. "A multi-objective and multi-period optimization model for urban healthcare waste’s reverse logistics network design," Journal of Combinatorial Optimization, Springer, vol. 42(4), pages 785-812, November.
    11. Salehi-Amiri, Amirhossein & Zahedi, Ali & Akbapour, Navid & Hajiaghaei-Keshteli, Mostafa, 2021. "Designing a sustainable closed-loop supply chain network for walnut industry," Renewable and Sustainable Energy Reviews, Elsevier, vol. 141(C).
    12. Yves Crama & Michel Grabisch & Silvano Martello, 2022. "Preface," Annals of Operations Research, Springer, vol. 314(1), pages 1-3, July.
    13. Patricia van Loon & Luk N. Van Wassenhove & Ales Mihelic, 2022. "Designing a circular business strategy: 7 years of evolution at a large washing machine manufacturer," Business Strategy and the Environment, Wiley Blackwell, vol. 31(3), pages 1030-1041, March.
    14. Ramani, Vinay & De Giovanni, Pietro, 2017. "A two-period model of product cannibalization in an atypical Closed-loop Supply Chain with endogenous returns: The case of DellReconnect," European Journal of Operational Research, Elsevier, vol. 262(3), pages 1009-1027.
    15. Dilupa Nakandala & Yung Po Tsang & Henry Lau & Carman Ka Man Lee, 2022. "An Industrial Blockchain-Based Multi-Criteria Decision Framework for Global Freight Management in Agricultural Supply Chains," Mathematics, MDPI, vol. 10(19), pages 1-23, September.
    16. Dmitry Ivanov, 2022. "Viable supply chain model: integrating agility, resilience and sustainability perspectives—lessons from and thinking beyond the COVID-19 pandemic," Annals of Operations Research, Springer, vol. 319(1), pages 1411-1431, December.
    17. Gong, Hailei & Zhang, Zhi-Hai, 2022. "Benders decomposition for the distributionally robust optimization of pricing and reverse logistics network design in remanufacturing systems," European Journal of Operational Research, Elsevier, vol. 297(2), pages 496-510.
    18. Ghanei, Shima & Contreras, Ivan & Cordeau, Jean-François, 2023. "A two-stage stochastic collaborative intertwined supply network design problem under multiple disruptions," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 170(C).
    19. Arunanondchai, May, 2001. "Can Indonesia Gain from Log Export Barriers?," The Warwick Economics Research Paper Series (TWERPS) 619, University of Warwick, Department of Economics.
    20. Mehmet Talha Dulman & Surendra M. Gupta, 2018. "Evaluation of Maintenance and EOL Operation Performance of Sensor-Embedded Laptops," Logistics, MDPI, vol. 2(1), pages 1-22, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:19:p:12920-:d:937886. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.