Sustainable supply chain network design: An application to the wine industry in Southern Portugal

Abstract

A case study of the wine industry in southern Portugal was conducted to provide a balanced approach to sustainable supply chain network design. A multi-objective model was developed integrating economic, environmental and social dimensions. The economic objectives include profit and revenue maximisation of the focal winery and minimisation of supply chain costs. The environmental objectives comprise minimisation of greenhouse gas emissions and of water consumption in vineyards and winery. The social dimension encompasses maximising employment and the number of suppliers and facilities. The model optimises the capacity of supply chain facilities, the production rate of wine and its combination, the amount of materials and wine that are moved through the supply chain, and selects suppliers. An achievement scalarizing functions approach was applied to the model, with some reference points projected on Pareto frontiers. The results showed that the current supply chain can be reconfigured and become more sustainable.