Raw Material Size Commonality Decision Tool: A Bi-Objective Integer Programming Model

This paper addresses the industrial challenge of raw material size commonality. The Best Allocation of Resource Sizes (BARS) problem is introduced, wherein the same raw material is utilized across multiple products, and it is not possible to reuse the leftover raw material. The objective is to explore the cost implications of reducing the number of different raw materials sizes, considering several cost components, ie, purchase, scrap, storage, safety stock, and set-up costs. The problem is formulated as a biobjective nonlinear integer program, seeking to simultaneously minimize the number of items and costs. The model is solved using an adapted version of the ε-constraint method. The efficacy of the proposed model is demonstrated through validation in three real-world case studies spanning different industrial sectors. The developed model serves as a decision support tool for management, facilitating an understanding of the consequences associated with different sets of selected raw materials. Also, it permits the imposition of cost limits based on strategic objectives, whether in total or pertaining to specific cost items, and enables the analysis of feasible solutions with respect to the sets of items that can be purchased.