On the inventory model with variable lead time and price–quantity discount

Chang C-T () and Chang S-C
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Chang C-T: National Changhua University of Education
Chang S-C: National Changhua University of Education

Journal of the Operational Research Society, 2001, vol. 52, issue 10, 1151-1158

Abstract: Abstract In this paper, we propose a mixed integer optimization approach for solving the inventory problem with variable lead time, crashing cost, and price–quantity discount. A linear programming relaxation based on piecewise linearization techniques is derived for the problem. It first converts non-linear terms into the sum of absolute terms, which are then linearized by goal programming techniques and linearization approaches. The proposed method can eliminate the complicated multiple-step solution process used in the traditional inventory models. In addition, the proposed model allows constraints to be added by the inventory decision-maker as deemed appropriate in real-world situations.

Keywords: just-in-time; price–quantity discount; inventory; lead time; linearization; global optimization (search for similar items in EconPapers)
Date: 2001
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DOI: 10.1057/palgrave.jors.2601172

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