Redesigning of Procurement Distribution System Network: An Application of Clustering Algorithms

Abstract

With the objective of minimizing the total distance travelled, the work proposes a novel procurement-distribution design network of the supply chain for the fair price shops (FPS) in the public distribution system of India. The work is a two-step process. The first step is to understand the existing distribution system. This starts from identifying the existing location of the FPS and converting them to its geographical locations in terms of longitudes and latitudes which are converted to distances to estimate the total distance travelled. The study, as a case, is conducted for one of the districts of Kerala, which is the rice bowl of Kerala which has 14 depots that serves the total 941 FPS in the district. The total distance travelled by the current distribution network is identified in the first step. The second step of the work is to determine the optimal number of depots that would be required to serve the existing 941 FPS of the district. To determine the optimum number of depots K-mean clustering applying the centroid approach is proposed to be adopted. We are proposing a novel distribution cum procurement supply chain. The trucks on delivery of the goods can collect the grains procured at the FPS from the farmers. The second step would primarily optimize the number of depots required to serve the FPS, and then identify the FPS that could be distributed from the given depot. The objective is to provide a scientific solution to minimize the total transportation distance by identifying the geographical location and adopting the k-mean clustering procedure. Finally, the benefits of implementing the proposed model will be quantified and discussed in detail by comparing the existing distribution system.