Decision model for planning material supply channels in construction

Material supply-related decisions strongly affect economic performance of construction projects. To facilitate planning, the authors put forward a mixed integer linear programming model for optimizing supplies of materials or components that are consumed irregularly. The model's objective function is minimizing the total inventory management cost. As material prices change over time and cannot be predicted with certainty, they are expressed as fuzzy values with triangular membership functions. The planning horizon is divided into units of time to allow for seasonal changes and scope variations that affect consumption of materials. The model enables the user to determine economic order quantities for consecutive periods of construction works and to select most economical supply channels of a particular material/component. The model allows for material/component substitution. Substitutes may differ in level of prefabrication and thus in costs of on-site processing. To solve the problem the fuzzy model is converted into a three-objective linear program with crisp coefficients. An example illustrates benefits of using the proposed approach in reducing the total inventory cost.