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Multi-period channel coordination in vendor-managed inventory for deteriorating goods.
- Source :
- International Journal of Production Research; Aug2012, Vol. 50 Issue 16, p4396-4413, 18p, 1 Diagram, 4 Charts, 5 Graphs
- Publication Year :
- 2012
-
Abstract
- This study examines the problem of optimally dynamic joint decisions, including replenishment scheduling/quantity, retail price, wholesale price, and revenue-sharing allocation, in a vertically decentralised single-manufacturer Stackelberg and single-retailer channel over a multi-period planning horizon, subject to deteriorating goods and multivariate demand function. This study uses a calculus-based formulation combined with dynamic programming techniques to solve the channel coordination decision problem. Additionally, three arrangements, namely price-only contract, revenue-sharing contract, and revenue-sharing plus linear rebate and side-payment contract for channel coordination, are developed under retailer-managed inventory (RMI) and vendor-managed inventory (VMI) systems, respectively. The analysis reveals that the proposed policy under the VMI system with the revenue-sharing plus linear rebate and side-payment contract tends to obtain low retail prices and large demand quantity, and results in near-perfect coordination, including greater system efficiency and Pareto improvements, for the vertically decentralised dynamic channel. [ABSTRACT FROM PUBLISHER]
Details
- Language :
- English
- ISSN :
- 00207543
- Volume :
- 50
- Issue :
- 16
- Database :
- Complementary Index
- Journal :
- International Journal of Production Research
- Publication Type :
- Academic Journal
- Accession number :
- 78236202
- Full Text :
- https://doi.org/10.1080/00207543.2011.592159