A Bilevel Programming Model for a Cohesive Decision-Making on Strategic Pricing and Production Distribution Planning for a Small-Scale Supplier

Akhilesh Kumar, Anjana Gupta () and Aparna Mehra ()
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Akhilesh Kumar: Department of Applied Mathematics, Delhi Technological University, Main Bawana Road, New Delhi 110042, Delhi, India2Department of Mathematics, Arignar Anna Government Arts & Science College, Karaikal 609605, Puducherry, India
Anjana Gupta: Department of Applied Mathematics, Delhi Technological University, Main Bawana Road, New Delhi 110042, Delhi, India
Aparna Mehra: Department of Mathematics, Indian Institute of Technology, Hauz Khas, New Delhi 110016, Delhi, India

International Game Theory Review (IGTR), 2020, vol. 22, issue 02, 1-34

Abstract: This research develops a decision support for strategic pricing and aggregate production distribution planning for a small-scale supplier intending to penetrate into a potential market engendered by a single buyer. A novel mixed integer bilevel programming model is proposed to formulate the problem in which the supplier is considered as a leader and the buyer is a follower. The proposed model subsumes the assessment of demand share against the price quotation, enabling the supplier to prepare an aggregate production distribution plan accordingly. An integer coded genetic algorithm is used to solve the model and its implementation is exhibited through a test scenario.

Keywords: Strategic pricing; aggregate production distribution planning; demand allocation; bilevel programming; genetic algorithm (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1142/S0219198920400095

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