A Polynomial Time Algorithm for a Deterministic Joint Pricing and Inventory Model

In this paper we consider the uncapacitated economic lot-size model, where demand is adeterministic function of price. In the model a single price need to be set for all periods. Theobjective is to find an optimal price and ordering decisions simultaneously. In 1973 Kunreuther and Schrage proposed an heuristic algorithm to solve this problem. The contribution of our paper is twofold. First, we derive an exact algorithm to determine the optimal price and lot-sizing decisions. Moreover, we show that our algorithm boils down to solving a number of lot-sizing problems that is quadratic in the number of periods, i.e., the problem can be solved in polynomial time.pricing;inventory;production;lot-sizing

A Polynomial Time Algorithm for a Deterministic Joint Pricing and Inventory Model

In this paper we consider the uncapacitated economic lot-size model, where demand is a deterministic function of price. In the model a single price need to be set for all periods. The objective is to find an optimal price and ordering decisions simultaneously. In 1973 Kunreuther and Schrage proposed an heuristic algorithm to solve this problem. The contribution of our paper is twofold. First, we derive an exact algorithm to determine the optimal price and lot-sizing decisions. Moreover, we show that our algorithm boils down to solving a number of lot-sizing problems that is quadratic in the number of periods, i.e., the problem can be solved in polynomial time

A Polynomial Time Algorithm for a Deterministic Joint Pricing and Inventory Model

In this paper we consider the uncapacitated economic lot-size model, where demand is a deterministic function of price. In the model a single price need to be set for all periods. The objective is to find an optimal price and ordering decisions simultaneously. In 1973 Kunreuther and Schrage proposed an heuristic algorithm to solve this problem. The contribution of our paper is twofold. First, we derive an exact algorithm to determine the optimal price and lot-sizing decisions. Moreover, we show that our algorithm boils down to solving a number of lot-sizing problems that is quadratic in the number of periods, i.e., the problem can be solved in polynomial time

A note on a multi-period profit maximizing model for retail supply chain management

In this note we present an efficient exact algorithm to solve the joint pricing and inventoryproblem for which Bhattacharjee and Ramesh (2000) proposed two heuristics. Our algorithmappears to be superior also in terms of computation time. Furthermore, we point out several mistakes in the paper by Bhattacharjee and Ramesh.pricing;inventory;dynamic programming

Integrated market selection and production planning: complexity and solution approaches

Emphasis on effective demand management is becoming increasingly recognized as an important factor in operations performance. Operations models that account for supply costs and constraints as well as a supplier's ability to in°uence demand characteristics can lead to an improved match between supply and demand. This paper presents a new class of optimization models that allow a supplier to select, from a set of potential markets, those markets that provide maximum profit when production/procurement economies of scale exist in the supply process. The resulting optimization problem we study possesses an interesting structure and we show that although the general problem is NP-complete, a number of relevant and practical special cases can be solved in polynomial time. We also provide a computationally very effcient and intuitively attractive heuristic solution procedure that performs extremely well on a large number of test instances

Order Acceptance and Scheduling: A Taxonomy and Review

Over the past 20 years, the topic of order acceptance has attracted considerable attention from those who study scheduling and those who practice it. In a firm that strives to align its functions so that profit is maximized, the coordination of capacity with demand may require that business sometimes be turned away. In particular, there is a trade-off between the revenue brought in by a particular order, and all of its associated costs of processing. The present study focuses on the body of research that approaches this trade-off by considering two decisions: which orders to accept for processing, and how to schedule them. This paper presents a taxonomy and a review of this literature, catalogs its contributions and suggests opportunities for future research in this area