Integration of financial statement analysis in the optimal design of supply chain networks under demand uncertainty

Models that aim to optimize the designof supply chain networks have becomeamainstream in the supply chain literature. This paper aims to fill a gap in the literature by introducing a mathematical model that integrates financial considerations with supply chain design decisions under demand uncertainty. The proposed Mixed-Integer Linear Programming (MILP) problem enchases financial statement analysis throughfinancial ratios and demanduncertainty through scenario analysis. The applicability of themodel is illustrated by using a case study alongwith a sensitivity analysis on financial parameters expressing the business environment. The model could be used as an effective and convenient strategic decision tool by supply chain managers. & 2010 Elsevier B.V. All rights reserved.