Dynamic pricing and inventory control with delivery flexibility

Wen Chen () and Ying He ()
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Wen Chen: Providence College
Ying He: University of Southern Denmark

Annals of Operations Research, 2022, vol. 317, issue 2, No 8, 508 pages

Abstract: Abstract We study a multi-period inventory system with price-sensitive demand and uncertain supplier, focusing on the advantage of delivery flexibility. The optimal pricing and inventory replenishment decisions are explored. We also investigate the changes of marginal profit, optimal order quantities and optimal prices over time horizon with additive demand noise. By comparing our system with delivery flexibility with the other two traditional systems numerically in different scenarios, we show that the delivery flexibility can improve the total profit and mitigate the supply risk.

Keywords: Inventory control; Dynamic pricing; Delivery flexibility (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/s10479-017-2555-7

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