Maryam Noroozi; Mohammad Reza Gholamian
Abstract
In the proposed study, an inventory model of a two-echelon green perishable supply chain which consists of one manufacturer and one retailer is investigated. The produced items have a deterministic shelf life and will be removed from the shelves when they reach to their expiration date. A novel formulation ...
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In the proposed study, an inventory model of a two-echelon green perishable supply chain which consists of one manufacturer and one retailer is investigated. The produced items have a deterministic shelf life and will be removed from the shelves when they reach to their expiration date. A novel formulation of the demand function is also presented, which is a multiplicative function of time after replenishment, retail price, and green improvement level. The formulated demand function increases with the time to expiration and the green improvement degree; it also decreases with the retail price. The mentioned characteristics in this supply chain are derived from the industries of selling fruits, vegetables, meat and poultry, as well as dairy products. The manufacturer is considered the leader of the Stackelberg game, and three approaches are proposed to solve the inventory model: Decentralized, Centralized, and Coordinated by the revenue and green technology investment cost sharing contract, which guarantees more profit for each member than the decentralized decision-making approach. The numerical results demonstrate that the proposed revenue-sharing contract could successfully help the supply chain members to achieve the potential supply chain profit in the centralized approach. A comparative study is also conducted to show the differences between implementing and not implementing green technology investments, which shows the profitability of making green technology investments when consumers have green preferences. It was observed that as the reservation cost increases, the importance of investments in green technology will increase for both parties. Also, with high potential market demand, it is more beneficial to invest in green technology. This study deals with a contribution to the formulation of the demand function, as a novel multiplicative function of time after replenishment in the form of power function, and retail price and green improvement level in the form of complementary linear function.
Marzieh Karimi; Hasan Khademi zare; Yahia Zare Mehrjerdi; Mohammad-Bagher Fakhrzad
Abstract
Vendor-managed inventory (VMI) is a popular inventory management system that allows a vendor to access sales data and manage inventory levels for his retailers. The formulation of service level and pricing decisions are finite in the VMI model literature. The study examines how a manufacturer and its ...
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Vendor-managed inventory (VMI) is a popular inventory management system that allows a vendor to access sales data and manage inventory levels for his retailers. The formulation of service level and pricing decisions are finite in the VMI model literature. The study examines how a manufacturer and its retailer communicate with one another to optimize their net profits through modifying service level, pricing, and inventory policy in a VMI system employing a Stackelberg game. The manufacturer produces a product and distributes it to several retailers at a similar wholesale price. The retailers subsequently offer the product at retail pricing in independent marketplaces. The Cobb-Douglas demand function could characterize the demand rate in every market, which is an enhancing function of the service level, however, a reducing function of retail prices. The manufacturer selects its wholesale pricing, replenishment cycles, backorder amount, and binary variable for production capacity to optimize profit. Retailers determine retail pricing and service levels so that they may optimize their profitability. Solution procedures are evolved for finding the Stackelberg game equilibrium from which no firm is inclined to deviate from maximizing its profit. The balance benefits the manufacturer while increasing the revenues of the retailers. If the retailers are prepared to engage with the manufacturer via a cooperative contract, the equilibrium could be enhanced to the advantage of both the manufacturer and his retailers. Ultimately, a numerical example is shown, along with the appropriate sensitivity analysis, to demonstrate that. 1) In certain circumstances, the manufacturer might benefit from his leadership and monopolize the additional profit generated by the VMI system. 2) The manufacturer's profit, and later the retailers' profit, could be increased more by the cooperative contract, in comparison to the Stackelberg equilibrium; 3) Market-related parameters have a substantial impact on the net profit of any enterprise.
Reza Pakdel Mehrabani; Abbas Seifi
Abstract
This paper investigates the Stackelberg equilibrium for pricing and ordering decisions in a multi-channel supply chain. We study a situation where a manufacturer is going to open a direct online channel in addition to n existing traditional retail channels. It is assumed that the manufacturer is the ...
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This paper investigates the Stackelberg equilibrium for pricing and ordering decisions in a multi-channel supply chain. We study a situation where a manufacturer is going to open a direct online channel in addition to n existing traditional retail channels. It is assumed that the manufacturer is the leader and the retailers are the followers. The situation has a hierarchical nature and is formulated as a bi-level programming problem. The upper level problem is a mathematical model dealing with decisions of the manufacturer, while the lower level is a Nash equilibrium model determining the retail prices and order quantities by formulating the competition between the physical retailers. We consider a price-sensitive linear demand model with an additive uncertain part and analyze the optimal decisions for each sales channel. To enable supply chain coordination, we propose a particular revenue-sharing contract. This contract enables the retailers to set pricing and ordering policies that are equivalent to those in an integrated supply chain. Finally, we examine the impact of the model parameters on the equilibrium with a comprehensive numerical study.