Entropy-Maximization-Based Customer Order Allocation of Clothing Production Enterprises in the Sharing Economy

Feifeng Zheng, Chunle Kang, Qinrui Song and Ming Liu ()
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Feifeng Zheng: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Chunle Kang: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Qinrui Song: Glorious Sun School of Business and Management, Donghua University, Shanghai 200051, China
Ming Liu: School of Economics and Management, Tongji University, Shanghai 200092, China

Sustainability, 2022, vol. 14, issue 22, 1-21

Abstract: With the rapid development of the sharing economy, more and more platform operators apply the sharing concept in manufacturing, which increases the efficiency of assets utilization. Considering the apparel industry, clothing enterprises or manufacturers may share their excess orders between each other via a manufacturing cloud platform. Under the traditional production mode, manufacturers focus on processing their individual orders. There may be a coexistence of insufficient and surplus production capabilities. Some manufacturers cannot meet their customer demands due to limited capabilities and some orders have to be rejected, while some other manufacturers may have excess capacities with insufficient demands. It results in loss of revenue, and it is not conducive to maintaining a good customer relationship. In this paper, we consider a shared system with multiple manufacturers that produce homogeneous products, and the manufacturers in the shared system can share customer orders with each other. Once any manufacturer cannot fulfill all of its orders, the unsatisfied ones will be shared with other manufacturers that have surplus capacities with the aim of improving the balance of resource utilization and risk resistance of all manufacturers on the platform. The entropy maximization theory is mainly adopted to facilitate the formulation of the objective function. We apply a Taylor expansion to reformulate the objective function and construct a mixed-integer quadratic programming (MIQP) model. We employ off-the-shelf solvers to solve small-scale problems, and also propose a two-stage constructive heuristic algorithm to solve large-scale problems. Numerical experiments are conducted to demonstrate the efficiency of the algorithm.

Keywords: sharing economy; allocation; entropy maximization; differential evolution algorithm (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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