An Improved Truncated Distribution for Modelling the Procurement Planning of Agricultural Product
Keywords:Agricultural Product, Procurement Planning, Mixed-Integer Non-Linear Programming, Truncated Distribution
A procurement plan of agricultural products is important because agricultural products had uncertain factors involved make it difficult to plan. This research considered uncertainties that are factory demand, the number of supply coconuts purchased from contracted farms, the number of supply coconuts purchased from collectors, the coconut price purchased from collectors, the selling price which had different distributions each time. The mixed-integer non-linear programming was formulated and run for 500 trials. The objective was to maximize the annual total profit. The truncated distribution of the procurement plan was analyzed. The solution indicates how to define lower and upper truncated distributions. In addition, truncating the distribution interval in three cases: lower truncate case, upper truncate case, and doubly truncate case. By reducing the data interval by 5 to 20% when cutting the destination on the side or both ends. When comparing the non-truncated scenario to the lower truncated case, the result showed that the lower truncated case exhibited a profit increase of 3.60 percent. As a result, the importance of factors that are less likely to occur was reduced. Procurement planning becomes more profitable as a result.
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