Blood supply chain: the impact of facility location and inventory allocation decisions for non-blood inventories - analytical case study

The availability and delivery of blood can make the difference between life and death; hence, the blood supply chain must have smooth inventory flows. We examine how to accomplish this by analysing non-blood inventories, which are the supplies needed for blood collections, testing, and storage. We investigated non-blood inventory pre-positioning through a research partnership with the American Red Cross (ARC). The goals for the research project were to optimise the ARC's facility location and inventory allocation decisions. Using data from the ARC, we empirically formulated a fixed-charge model to solve the location-allocation problem. The results indicated that the ARC should both shut down and construct warehouses to attain cost savings of 9%. We also conducted sensitivity analyses with respect to demand and cost. Finally, we review our contributions to the literature on humanitarian logistics and blood supply chain, and we conclude by outlining future research opportunities.