A Study on the Production-Inventory Problem with Omni-Channel and Advance Sales Based on the Brand Owner’s Perspective

Jialiang Pan, Chi-Jie Lu, Wei-Jen Chen (), Kun-Shan Wu () and Chih-Te Yang
Additional contact information
Jialiang Pan: School of Business and Management, Jiaxing Nanhu University, Jiaxing 314001, China
Chi-Jie Lu: Graduate Institute of Business Administration, Fu Jen Catholic University, New Taipei City 242062, Taiwan
Wei-Jen Chen: Department of Business Administration, Tamkang University, New Taipei City 251301, Taiwan
Kun-Shan Wu: Department of Business Administration, Tamkang University, New Taipei City 251301, Taiwan
Chih-Te Yang: Department of Business Administration, Tamkang University, New Taipei City 251301, Taiwan

Mathematics, 2024, vol. 12, issue 19, 1-23

Abstract: This study explores a supply chain product-inventory problem with advance sales under the omni-channel strategies (physical and online sales channels) based on the brand owner’s business model and develops corresponding models that have not been proposed in previous studies. In addition, because the brand owner is a member of the supply chain, and has different handling methods for defective products or products returned by customers in various retail channels, defective products or returned products are included in the supply chain models to comply with actual operating conditions and fill the research gap in the handling of defective/returned products. Regarding the mathematical model’s development, we first clarify the definition of model parameters and relevant data collection, and then establish the production-inventory models with omni-channel strategies and advance sales. The primary objective is to determine the optimal production, delivery, and replenishment decisions of the manufacturer, physical agent, and online e-commerce company in order to maximize the joint total profits of the entire supply chain system. Further, this study takes the supply chain system of mobile game steering wheel products as an example, uses data consistent with the actual situation to demonstrate the optimal solutions of the models, and conducts sensitivity analysis for the proposed model. The findings reveal that increased demand shortens the replenishment cycle and raises order quantity and shipment frequency in the physical channel, similar to the online channel during normal sales. However, during the online pre-order period, higher demand reduces order quantity and cycle length but still increases shipment frequency. Rising ordering or fixed shipping costs lead to higher order quantity and cycle length in both channels, but variable shipping costs in the online channel reduce them. Market price increases boost order quantity and frequency in the online channel, while customer return rates significantly impact inventory decisions.

Keywords: production-inventory model; global supply chain; advance sales; omni-channel; brand owner (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2227-7390/12/19/3122/pdf (application/pdf)
https://www.mdpi.com/2227-7390/12/19/3122/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jmathe:v:12:y:2024:i:19:p:3122-:d:1492989

Access Statistics for this article

Mathematics is currently edited by Ms. Emma He

More articles in Mathematics from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().