Model for the Determining Number and Location of Food Loss Processing Facilities on the Food Supply Chain

Food loss occurs at every stage in the food supply chain, especially in the early stages of the food supply chain. To increase the added value of food loss, it can be done by changing food loss into food ingredients such as snack products or food supplement powder. This product change will increase the shelf life of the product and provide high nutritional value. A processing facility is needed to convert food loss into value-added food products. Therefore, this study aims to develop a model for determining the optimal number and location of processing facilities. The model developed is in the form of Mixed Integer Linear Programming (MILP) which minimizes production cost, transportation cost, food loss transportation cost, processing facility set up cost, and processed product transportation cost. Numerical example is also given in this study for the application of the resulting MILP model.