Operations planning in a supply chain system with fixed-interval deliveries of finished goods to multiple customers

Raw material ordering policy and the manufacturing batch size for fixed-interval deliveries of finished goods to multiple customers play a significant role in economically managing the supply chain logistics. This paper develops an ordering policy for raw materials and determines an economic batch size for a product at a manufacturing center which supplies finished products to multiple customers, with a fixed-quantity at a fixed time-interval to each of the customers. In this model, an optimal multi-ordering policy for procurement of raw materials for a single manufacturing system is developed to minimize the total cost incurred due to raw materials and finished goods inventories. The carried over inventory of finished goods from the previous cycle is used as initial finished goods inventory, resulting in shifting the production schedule ahead for the next cycle. A closed-form solution to the problem is obtained for the minimal total cost. The algorithm is demonstrated for multiple customer systems.     

An integrated robust replenishment/production/distribution policy under inventory inaccuracy

In this paper, a centralised production/distribution system is studied, in which the manufacturer controls the processes of raw material ordering, production and final goods distribution. The inventory records of raw materials, work-in-process, final goods in the manufacturer and the retailers are inaccurate. The objective of this research is to develop an integrated policy that can hedge against the negative impact of inventory inaccuracy at all stages of a supply chain. To achieve this aim, a backward recursive integrated robust policy is constructed. First, the time, quantity and vehicle route of the next distribution are forecasted by a distribution sub-policy; then the forecasted distribution time and quantity are used as the objective of the production process control, which is implemented by a production control sub-policy. Raw materials are ordered by a replenishment sub-policy according to the forecasted raw materials consumption in the production process. Numerical experiments are conducted to verify the feasibility and robustness of the proposed policy, which shows that besides of deploying radio frequency identification (RFID) devices in inventory management systems for raw materials, WIPs, final goods of the manufacturer and the retailers, integrated robust policies also can be employed to hedge against the impact of inventory inaccuracy.     

Quick response procurement cost control strategy for fabric manufacturing

This paper considers a material management decision making problem with information revision of a fabric manufacturer, facing highly uncertain material supply and quick response demand. We construct a model by analysing the decision process, derive the optimal solution and study the interaction among factors through a practical data based computational simulation. The demand information, in terms of estimated volume, modifiable order, and order confirmation respectively, is provided by the final buyer to the fabric manufacturer in consecutive time periods. We investigate normal and urgent raw material (yarn) purchasing costs, holding cost, overstock salvage cost, as well as availability of raw materials for urgent order. The model for a single item is then extended to that for multiple items with the capacity constraint. The research shows that a fabric manufacturer plays a critical role in operations efficiency and overall cost control in a typical apparel supply chain, and reveals the cost trade offs between purchasing and inventory under this special business environment.     

闭环供应链广告协调机制研究

为了研究闭环供应链中零售商回收与制造商回收时两种情形下价格决策与广告协调策略,在广告既能影响市场需求又能影响回收率的条件下,运用博弈论分别建立制造商回收与零售商回收时的广告分摊协调策略数学模型,结果表明制造商回收模式有利于零售商,零售商回收模式有利于制造商。零售商所分摊的广告费用比例在制造回收时小。制造商回收时零售商所分摊的广告费用比例与广告回收效率因子负相关,与广告营销效率因子正相关。零售商将回收时零售商所分摊的广告费用比例与回收效率因子、营销效率因子无关。最后通过仿真证明了相关结论。本文的研究为闭环供应链在不同回收模式下广告回收效率与营销效率的变化时提供相应的协调策略。     

Pricing and effort decisions for a supply chain with uncertain information

This paper analyses the pricing and effort decisions of a supply chain with single manufacturer and single retailer. The manufacturer produces a kind of product and then wholesales the product to the retailer, who in turn retails it to customers over a single selling season. The retailer can influence demand through her sales effort. This research depicts the consumer demand, the manufacturing cost and the sales effort cost as uncertain variables. Considering the demand expansion effectiveness of sales effort, one centralised and three decentralised game models are built on the basis of the expected value criterion, and the equilibrium solutions are obtained. We investigate the effects of the parameters’ uncertainty degrees on the pricing and effort decisions. The results indicate that the manufacturer benefits from improvement in demand and cost uncertainties when he has at least bargaining power in the supply chain. The results also imply that the uncertainty degree of sales effort elasticity has an outstanding influence on the pricing and effort decisions, whereas the uncertainty degree of price elasticity has a modest impact on these decisions. We also study the effects of the parameters’ uncertainty degrees on the supply chain from the consumers’ perspective. The results suggest that with a power retailer, the retail price should always be on the high end. Consequently, consumers do not necessarily benefit from a power retailer. When the manufacturer and the retailer have equal bargaining power, consumers do not necessarily benefit from the supply chain, either.     

Integrated product design,shelf-space allocation and transportation decisions in green supply chains

In this paper, we examine a supply chain consisting of a manufacturer and retailer where the manufacturer undertakes greening efforts in terms of pack-size reduction and transportation cost reduction. The retailer decides on shelf-space allocation for the product. Both the players benefit from the greening efforts of the manufacturer. In such a setting, we examine strategic decisions of the players and compare and contrast the performance of the decentralised supply chain with the centralised supply chain. We also examine the effect of collaborative mechanisms by modelling two contracts in which the retailer offers a transportation cost reduction effort based contract and a two-part tariff contract. We find that the decentralised supply chain leads to lower greening efforts and shelf-space allocation decisions. We also find that the contracts improve pack-size reduction effort, transportation cost reduction effort and shelf-space allocation, while also improving the profitability of individual players. The findings demonstrate a scope for supply chain collaboration between manufacturer–retailer pairs in this setting. The paper uniquely combines three critical elements in supply chains, namely, product design, transportation and retailing decisions, and aims to provide insights into the decision making of players considering environmental waste and pollution. The paper also reflects consumer behavior and trade-offs that the supply chain players face.     

Joint economic production allocation and ordering policies in a supply chain consisting of multiple plants and a single retailer

This article discusses the production and ordering policies in a supply chain consisting of a single manufacturer and a single retailer. The retailer places orders based on the EOQ-like policy, and the manufacturer purchases raw materials and allocates them to the multiple plants in parallel to produce demand requirement from the retailer. The model is mathematically formulated, and the solution procedure is developed to determine the production cycle length, ordering quantity and frequency, and production allocation ratios for multiple plants. The closed forms of the production cycle length, ordering quantity, and frequency in terms of the production allocation ratios are obtained. It is also shown that the production allocation problem is NP-hard. An efficient and effective heuristic algorithm is proposed to determine the near-optimal production allocation ratios. A numerical experiment demonstrates that the proposed algorithm performs quite satisfactorily.     

Supply chain design to guarantee quoted lead time and inventory replenishment: model and insights

Do lead time constraints only lead to re-think and re-optimise the inventory positioning along the supply chain or can they impact on the design of the supply chain itself? To answer such a question, we integrate the lead time constraints in a multi-echelon supply chain design model and challenge the difficulty of combining in the same model the long-term decisions (facility location, supplier selection) with the midterm decisions (inventory placement and replenishment, delivery lead time). The model guarantees the respect of the quoted lead time associated with each customer order and the replenishment of the different stocks (raw materials, intermediate and final products) in the different stages of the supply chain between any pair of consecutive orders. We use the model to investigate the impact of the quoted lead time and customer’s order frequency on supply chain design decisions and costs. Some of our results indicate that the lead time constraints can lead to bringing the sites of manufacturing and distribution close to the demand zone and to select local suppliers in spite of their higher cost.     

Fuzzy goal programming for material requirements planning under uncertainty and integrity conditions

In this paper, we formulate the material requirements planning) problem of a first-tier supplier in an automobile supply chain through a fuzzy multi-objective decision model, which considers three conflictive objectives to optimise: minimisation of normal, overtime and subcontracted production costs of finished goods plus the inventory costs of finished goods, raw materials and components; minimisation of idle time; minimisation of backorder quantities. Lack of knowledge or epistemic uncertainty is considered in the demand, available and required capacity data. Integrity conditions for the main decision variables of the problem are also considered. For the solution methodology, we use a fuzzy goal programming approach where the importance of the relations among the goals is considered fuzzy instead of using a crisp definition of goal weights. For illustration purposes, an example based on modifications of real-world industrial problems is used.     

Integrated product and container inventory model for a single-vendor single-buyer supply chain with owned and rented returnable transport items

This study considers a single vendor supplying a single retailer with a finished product packed in returnable transport items (RTIs), such as containers, pallets or crates, to facilitate its safe shipment. Once received at the retailer’s site, the RTIs are emptied, cleaned, repaired if needed and returned to the vendor to be used for the next shipment. Because of unexpected events, such as damage of RTIs and/or shortage of labour to empty RTIs, the RTI return time is considered stochastic in this study. In case the return of empty RTIs is delayed, the vendor has the option to rent RTIs from a nearby service provider to avoid disruptions in the delivery schedule and finished product shortages at the buyer’s premise. We formulate the problem of coordinating the flow of both the finished product and RTIs and minimising the supply chain wide costs as a mixed-integer non-linear programme. For a convex objective function, we develop an efficient solution procedure that generates the optimal replenishment cycle, the optimal number of RTIs and the optimal number of trucks. The general optimisation model and the solution procedure are illustrated for the case where the RTI return time is exponentially distributed. In addition, we conduct an experimental study to assess the impact of the problem parameters on the decision variables. It is found that renting RTIs is especially beneficial in case both shortage cost and the risk of late RTI returns are high. In addition, the average RTI return time is found to be critical for the performance of the supply chain.     

资金约束时零售商融资与订货决策及价值分析

针对供应链中存在资金约束的情形,建立了包含制造商（M）、零售商（R）双层结构、不考虑残次品率、库存成本和融资周期长短的简洁供应链决策模型。研究了当市场需求不确定和零售商资金不足情形下,零售商选择是否融资这两种情况下,其订货决策的变化,以及零售商和制造商的收益变化。通过有无融资条件下零售商不同数量自有资金时订货量和期望收益对比和零售商自有资本一定时订货量随周期变化的数值分析,证明了零售商的融资决策与订货量决策会随着其自有资金及市场需求的变化而变化;验证了融资可以提高零售商和供应链的收益,而且能够使得供应链的总产品尽快达到最佳产量,有效满足消费者需求。     

不同供应链合同的最优订货策略及适用性比较

针对由一个制造商和一个零售商组成的单一易逝品供应链,在随机库存问题报童模型基础上,推导了回购、收入分享和数量折扣合同下,零售商的最优订货策略、零售商和制造商的期望利润,给出了不同供应链合同的适用条件。通过一个皮衣生产、销售供应链的案例,对不同供应链合同下的最优订货策略、合同适用性及原因进行了分析、比较。为理解不同供应链合同的适用性提供了数理依据和案例解释。     

Configuring a manufacturing firm's supply network with multiple suppliers

Consider a supply network consisting of a manufacturer and its suppliers. The manufacturer produces different types of products, using a common set of inputs (e.g., raw materials and/or component parts) from the suppliers: but, each product needs a different mix of these inputs. The manufacturer sells its finished products to the market at the end of the current decision horizon, facing an uncertain market demand. In situations where a manufacturer has outsourced its parts production to contract manufacturers, the contract manufacturer's capacity available for the given manufacturer in a particular time period may be limited by “capacity reservation” agreements made in advance. Thus, in making production mix decisions for the current planning horizon, the manufacturer has to take into account both its own and the component suppliers' capacity restrictions. We develop a mathematical model and an iterative algorithm that helps the manufacturer solve its supply configuration problem, that is, how much of each raw material and/or component part to order from which supplier, given capacity limits of suppliers as well as the manufacturer. The model takes into account such factors as market demand uncertainty, costs and product characteristics. We present an numerical example to illustrate the interacting effects among critical parameters in the model, and apply the model to a real-world case of a computer manufacturer.     

Dual-channel supply chain pricing decisions with a risk-averse retailer

This paper investigates a dual-channel supply chain with one risk-neutral manufacturer and one risk-averse retailer where there is only one perishable product with price-dependent stochastic demand. We choose Conditional Value-at-Risk criterion to measure the retailer’s risk-averse level, and assume that the manufacturer’s direct sales channel and the retailer’s traditional channel adopt a consistent pricing strategy. The model explores a Nash bargaining problem where the manufacturer and the retailer negotiate with each other on the wholesale price, the retail price and the order quantity when they have equal bargaining power. It is found that when demand uncertainty follows a uniform distribution, a Nash bargaining equilibrium exists and the retail price will decrease as the retailer becomes more risk averse. However, when the risk-averse indicator increases, the manufacturer’s profit on his direct channel will decrease, increase or first increase and then decrease, depending on the values of the related parameters. The profit shares of the manufacturer and the retailer under the Nash equilibrium model are related to the risk-averse indicator of the retailer. Furthermore, we perform three sets of numerical experiments to verify the effects of the retailer’s risk-averse indicator on decision-making and profit allocations under the different environmental parameters and gain several meaningful managerial insights.     

Myopic vs. far-sighted behaviours in a revenue-sharing supply chain with reference quality effects

In this paper, we consider a dynamic supply chain where a manufacturer produces and distributes a featured product through an exclusive retailer to end consumers. The manufacturer decides the product quality and wholesale price, while the retailer sets the retail price in the presence of a revenue-sharing contract and consumers’ reference quality effects. The objective of this study is to investigate the impacts of myopic behaviour regarding the reference quality on the product quality and pricing strategies and profits of both members. Our results suggest that the manufacturer’s myopia leads to a higher quality, higher price strategy and a higher quality–price ratio which benefits consumers. Meanwhile, relative to the far-sighted behaviour, myopia results in a more quality-sensitive but less price-sensitive market demand. What’s more, we find that the manufacturer is apt to act in a far-sighted way, but the retailer isn’t always willing to cooperate with a far-sighted manufacturer. Taking myopic strategies for both members is likely to gain a high profit of the whole supply chain for a relatively high marginal contribution of product quality on demand and a relatively low revenue-sharing proportion.     

考虑收取搭便车消费者产品体验费的双渠道供应链定价

为研究实体零售商收取搭便车消费者产品体验费时消费者搭便车行为对厂商的影响,并探讨实体零售商收取产品体验费的条件,文章考虑一个制造商和一个实体零售商组成的双渠道供应链,基于消费者效用理论,利用K-T条件,分别在收取产品体验费和不收取产品体验费两种情形下,分析对比了消费者搭便车行为对厂商决策的影响。研究表明,收取的搭便车消费者产品体验费与实体零售商的产品销售价格正相关,当消费者旅行成本较低时,网络渠道产品销售价格与收取的产品体验费负相关。当消费者旅行成本较低且销售的产品估值较高时,实体零售商收取产品体验费才能使自身受益。研究进一步显示,实体零售商收取搭便车消费者产品体验费会损害制造商的利润,加剧了制造商和零售商之间的竞争。     

质量影响需求下的二级供应链协调模型研究

针对产品的生产质量和销售质量同时影响顾客需求问题,建立了制造商处于领导地位的二级供应链决策模型,分析了在分散式决策和集中式决策下制造商和零售商关于产品质量的决策,设计了一个成本分摊和收入共享契约协调供应链。结果表明,该契约能将制造商和零售商紧密地联系在一起,共同分担风险,通过共同努力都能获得比分散式决策下更大的利润,体现了供应链协调的思想。     

Decentralized inventory control in a two-stage capacitated supply chain

This paper investigates a two-stage supply chain consisting of a capacitated supplier and a retailer that faces a stationary random demand. Both the supplier and the retailer employ base stock policies for inventory replenishment. All unsatisfied demand is backlogged and the customer backorder cost is shared between the supplier and the retailer. We investigate the determination of decentralized inventory decisions when the two parties optimize their individual inventory-related costs in a noncooperative manner. We explicitly characterize the Nash equilibrium inventory strategies and identify the causes of inefficiency in the decentralized operation. We then study a set of simple linear contracts to see whether these inefficiencies can be overcome. Finally, we investigate Stackelberg games where one of the parties is assumed to be dominating.     

Joint effects of remanufacturing channel design and after-sales service pricing: an analytical study

We conduct an analytical study on remanufacturing channel design and after-sales service pricing, which jointly affect the sustainability and profitability of the supply chain. We model a supply chain with one manufacturer and one independent retailer. The manufacturer, as the Stackelberg game leader, engages in remanufacturing to take advantage of production cost savings. The collection of the used products can be carried out by either the manufacturer or the retailer. After-sales service, for example, extended warranty, is offered with the product and is sold separately. The service provider can be either the manufacturer or the retailer. We use game theoretic models to answer an important research question: How do remanufacturing and after-sales service jointly affect channel selection decisions? We explore the benefits of joint decision making in terms of remanufacturing efficiency and after-sales service performance. We find that it is most efficient for the retailer to collect the used product for remanufacturing and to offer after-sales service, because the retailer simultaneously makes decisions regarding remanufacturing and after-sales service and thus reduces double marginalisation in the supply chain. We also demonstrate numerically how the costs of collecting used products and providing after-sales service impact channel selection decisions.     

需求信息更新下缺货成本共担的易逝品供应链协调研究

考虑在销售期初对市场需求进行更新的单制造商和单零售商组成的易逝品两级供应链系统,在缺货情形下仅允许零售商一次订货,且制造商采取两阶段生产并与零售商共同分担缺货成本。分析了缺货成本共担水平对供应链的影响,并用算例对结果进行了验证。研究表明,缺货成本共担水平与零售商订货量成正相关关系,与零售商利润成反相关关系;通过引入期权契约,供应链得到帕累托改进。