A Coordination Model Under an Order-Up-To Policy

A logistics system that involves a supplier who produces and delivers a single product and a buyer who receives and sells the product to the final customers was analyzed. A mathematical model was developed to describe the behavior of the system and to derive the optimal cycle length and order-up-to levels for the two parties. An analysis of the obtained results revealed that the methods were able to determine the optimal control parameters for each party in a short time frame. A coordination mechanism based on the optimal policies was ultimately proposed so that each party benefits more than if they use their own optimal control policy.

[1]  M. J. Rosenblatt,et al.  Improving Profitability with Quantity Discounts under Fixed Demand , 1985 .

[2]  R. Akella,et al.  Diversification under supply uncertainty , 1993 .

[3]  James P. Monahan.  A Quantity Discount Pricing Model to Increase Vendor Profits , 1984 .

[4]  Suresh Kumar Goyal,et al.  A one-vendor multi-buyer integrated inventory model: A comment , 1995 .

[5]  Suresh Kumar Goyal,et al.  Note-Comment on: A Generalized Quantity Discount Pricing Model to Increase Supplier's Profits , 1987 .

[6]  R. Hill.  The single-vendor single-buyer integrated production-inventory model with a generalised policy , 1997 .

[7]  Sarada Prasad Sarmah,et al.  Buyer vendor coordination models in supply chain management , 2006, Eur. J. Oper. Res..

[8]  Avijit Banerjee,et al.  A supplier's pricing model under a customer's economic purchasing policy , 1986 .

[9]  Moosa Sharafali,et al.  Some models for understanding the cooperation between the supplier and the buyer , 2000 .

[10]  Meir J. Rosenblatt,et al.  Coordinating a three-level supply chain with quantity discounts , 2001 .

[11]  David F. Pyke,et al.  Inventory management and production planning and scheduling , 1998 .

[12]  M. Khouja.  Optimizing inventory decisions in a multi-stage multi-customer supply chain , 2003 .

[13]  Ajay K Mishra,et al.  Selective discount for supplier-buyer coordination using common replenishment epochs , 2004, Eur. J. Oper. Res..

[14]  H. Gurnani.  A study of quantity discount pricing models with different ordering structures: Order coordination, order consolidation, and multi-tier ordering hierarchy , 2001 .

[15]  Bowon Kim,et al.  Configuring a manufacturing firm's supply network with multiple suppliers , 2002 .

[16]  M. Ben-Dayaa,et al.  Integrated single vendor single buyer model with stochastic demand and variable lead time , 2004 .

[17]  L. Ouyang,et al.  Integrated vendor–buyer cooperative models with stochastic demand in controllable lead time , 2004 .

[18]  Lu Lu.  A one-vendor multi-buyer integrated inventory model , 1995 .

[19]  M. Hariga,et al.  Integrated single vendor single buyer model with stochastic demand and variable lead time , 2004 .

[20]  S. Viswanathan,et al.  Coordinating supply chain inventories through common replenishment epochs , 2001, Eur. J. Oper. Res..

[21]  Dean H. Kropp,et al.  Effective and simple EOQ-like solutions for stochastic demand periodic review systems , 2007, Eur. J. Oper. Res..

[22]  Joong Y. Son,et al.  Coordinating orders in supply chains through price discounts , 2002 .

[23]  Gintautas Dzemyda,et al.  Large-Scale Data Analysis Using Heuristic Methods , 2011, Informatica.