Abstract
Abstract This study developed a strategic technique for managing inventory of perishable items using mathematical model, to stay within eco-friendly guidelines under optimum emission-based regulation policies. A customized model named E-DIM (Economic Deteriorating Inventory Management) was formulated and captured the impact of deterioration on inventory management system, help us to modify restocking with optimal economic and environmental performance. The proposed model integrated with five carbon emission policies to manage growing sustainable market situations and also to predict the optimal emissions policy under economic and environmental constraints. Main objective of the study is to derive an exclusive framework to compare different emission regulations policies such as carbon tax, cap, cap-and-trade, carbon offset and strict limit policy and help to identify the optimum emission strategy to maintaining balanced inventory system. With the calculate amount of emission formed from holding and transportation was integrated and the total cost function was derived under each policy based on their respective policy nature. The necessary and sufficient condition of each policy ensure the global optimality. Numerical example coupled with sensitive comparison of decision parameters of each policy, reveals the effective cost strategies to forecast the adoptable optimum emission regulations. The results and insights suggest the superior policies based on the decision variables, optimal replenishment cycle as well as with total cost function. This optimum comparative strategy navigates the inventory managers towards profitable and responsible concern over environment.