An integrated inventory model for vendor-customer coordination in a supply chain

D.K. Shaw, A. Mishra and D.A. Khan

International Journal of Business Performance and Supply Chain Modelling, 2011, vol. 3, issue 2, 181-194

Abstract: The present study focuses on determining economic ordering quantity (EOQ) and shipping strategy of an inventory system integrated with a single-product, single-vendor and multi-customer scenario. Depending on the demand of all customers, production and shipping policies are determined and present a suitable model to illustrate the transferring of equally-sized batches. Optimum values of the decision variables are determined using a direct search method. In order to justify the lot-splitting approach for solving the integrated inventory problem, alternative model with no lot splitting are devised and tested under the same circumstances which produce similar or better results. A numerical example and related sensitivity analysis are given to show the effectiveness of the proposed model.

Keywords: inventory modelling; shipping time; supply chain management; SCM; economic order quantity; EOQ; buyer-supplier relationship; lot splitting; vendor-customer coordination. (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijbpsc:v:3:y:2011:i:2:p:181-194

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