Research on Purchasing Based on Stock-Out Compensation With Price Continuous Reduction

Renxing Tan () and Yisong Li ()
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Renxing Tan: Beijing Jiaotong University
Yisong Li: Beijing Jiaotong University

A chapter in LISS 2014, 2015, pp 73-78 from Springer

Abstract: Abstract The electronic products update faster and faster and its price shows a declining trend. In order to seize the declining chance to reduce the purchasing cost, the companies often adopt the small lots & multi-frequencypolicy. As the demand is incertitude, stock-out is inevitable, which leads to the profit lost and furthermore, the loss of market shares. This paper considers introducing stock-out compensation policy into the purchasing decision with declining cost, works out the model through nonlinear programming related theories and compares the result with the model without stock-out compensation policy.

Keywords: Stock-out compensation; Continuous price reduction; Purchasing policy (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-662-43871-8_12

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DOI: 10.1007/978-3-662-43871-8_12

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