Study On The Inventory Control Under Carbon Emission Constraint And Stochastic Demand

The rapid development of world economy improves people’s economic environment but does great damage to the natural environment. Therefore, in order to reduce the serious consequences to the human society, low-carbon economy is becoming the focus of countries all over the world. In 2005, the European Union Emission Trading Scheme(EU ETS) was established, and so far, the carbon trading market moves well and has achieved remarkable results. Now China’s carbon emission ranks first in the world. In 2011, seven cities were selected to establish the carbon trading market in china, until 2014, all of the seven cities had set up the carbon trading markets and the whole markets move steadily now. On February 4th, 2015, the china high level forum on emissions Trading announced that a national carbon trading market will be established in 2016, and three stages was put forward to establish the national carbon trading market.The logistics is a high energy consumption and high emission industry, so the logistics undertakes huge pressure to reduce emissions, especially for China’s nascent logistics. In addition, the implementation of low carbon logistics has brought severe challenges to the operation of the supply chain processes, such as production, transportation, storage, sales and so on. This article is based on the macro background and studies the retailer’s ordering strategy under stochastic demand and low carbon situation.Firstly, this article introduces the low carbon logistics theory and the inventory control theory of stochastic demand. Based on the analysis of the newsboy model and the ? ?Qq, model which were used to solve the single and multi period stochastic demand problem, this paper proposes three different models which consider the carbon emission parameters. And then obtain the optimal order quantity by calculating the minimum expected cost or loss. At last, some conclusions are obtained and numerical examples are presented to verify these conclusions. These conclusions point out that whether the government chooses to implement the carbon emission limits can really affect the retailer’s order strategy; the carbon cap does not affect the order quantity, carbon emissions, and order point but has an impact on expected cost or loss. Under the condition of single period, discrete and stochastic demand, carbon factor makes the order quantities, carbon emissions and expected cost fluctuate between a few certain values. Under the condition of single period, continuous and stochastic demand, the increase of the carbon factors make the makes the optimal order quantity decreased. Under the condition of multi period, different carbon factors have different impacts on the optimal order quantity and order point. To sum up, these conclusions can be provide better order strategy for retailers when the carbon emission is constrained.