An analytical model to identify optimal levels of quality and price for fresh agricultural produce using cold chain facilities

Abstract

This paper deals with the problem of optimal sales scheduling of a perishable good using cold chain infrastructure to maximize the sellers profits. In our model we have incorporated perishability in terms of deterioration in the valuation of the product with time. The market itself is a dynamic entity and the price of the product varies with time and we have assumed that the seller has some influence on the market price by regulating his sales. The seller also has an option to deploy a cold storage facility to reduce the degradation rate of the product but it has its own costs. The model generates an optimal plan to efficiently deploy cold storage and a sales schedule to maximize the profit. In the sensitivity analysis, we have discussed the impact of various model parameters on decision variables which will give managers useful insight into the dynamics of the problem.