Supply Chain Planning under Various Quantity Commitment Contracts

Abstract This paper explores a type of supply contract under which the purchaser commits to buy a quantity of product per period with a granted flexibility over a certain horizon of time. We build a finite horizon linear programming model to characterize dynamically the production and replenishment planning depicted on each actor of the supply chain. This model based on rolling horizon planning considers gradually the emergence of new information (demand peak occurrence, disturbance on deliveries in workflow…) and takes account undergoing contractual supply constraints from the supplier. The purpose is then to investigate by numerical experimentations the impact of supply commitments contracted by partners on supply chain performance and responsiveness in order to draw some managerial insights.