Supply Chain Coordination Under Demand Uncertainty: Analysis of General Continuous Quantity Discounts

Hamid Mashreghi () and Mohammad Reza Amin-Naseri ()
Additional contact information
Hamid Mashreghi: Tarbiat Modares University
Mohammad Reza Amin-Naseri: Tarbiat Modares University

A chapter in Operations Research Proceedings 2013, 2014, pp 287-292 from Springer

Abstract: Abstract Quantity discount (QD) contracts are commonplace in theory and practice with different complexities. There exist two classes of QD contracts: continuous versus discrete schemes. Under continuous QD schemes, a general differentiable wholesale-price function is considered as a decreasing function of ordering quantities while in discrete QD schemes there is a price list with decreasing wholesale-price levels such as all-unit QD or incremental QD contracts. In this paper, we aim to analyze the structure of general continuous quantity discounts to coordinate a two-tier supply chain with additive demand uncertainty. We demonstrate sufficient coordination conditions based on joint-optimization of ordering and pricing decisions. Considering prerequisites for achieving coordination, the specific case of linear QD contract is analyzed and some applicable non-linear continuous QD schemes are introduced. Moreover application of such non-linear schemes is discussed for implementation of QDs (continues and discrete schemes) in real cases.

Keywords: Supply Chain; Joint Optimization; Quantity Discount; Supply Chain Coordination; Double Marginalization (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:oprchp:978-3-319-07001-8_39

Ordering information: This item can be ordered from
http://www.springer.com/9783319070018

DOI: 10.1007/978-3-319-07001-8_39

Access Statistics for this chapter

More chapters in Operations Research Proceedings from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().