Inventory ordering policies for mixed sale of products under inspection policy, multiple prepayment, partial trade credit, payments linked to order quantity and full backordering

The situation where serviceable products are sold together with a proportion of deteriorating products to consumers is rarely discussed in the literature. This article proposes an inventory model with disparate inventory ordering policies under a situation where a portion of serviceable products and a portion of deteriorating products are sold together to consumers (i.e. mixed sales). The ordering policies consider a hybrid payment strategy with multiple prepayment and partial trade credit schemes linked to order quantity under situations where no inventory shortage is allowed and inventory shortage is allowed with full backorder. The hybrid payment policy offered by a supplier is introduced into the classical economic ordering quantity model to investigate the optimal inventory cycle and the fraction of demand that is filled from the deteriorating products under inspection policy. Further, a new solution method is proposed that identifies optimal annual total profit with mixed sales assuming no inventory shortage and inventory shortage with full backorder. The impact of an inspection policy is investigated on the optimality of the solution under hybrid payment strategies for the deteriorating products. The validation of the proposed model and its solution method is demonstrated through several numerical examples. The results indicate that the inventory model along with the solution method provide a powerful tool to the retail managers under real-world situations. Results demonstrate that it is essential for the managers to consider inclusion of an inspection policy in the mixed sales of products, as the inspection policy significantly increases the net annual profit

Coordinating Pricing and Ordering Decisions in a Multi-Echelon Pharmacological Supply Chain under Different Market Power using Game Theory

Abstract The importance of supply chains in pharmacological industry is remarkable so that nowadays many pharmacological supply chains have an effective and critical role for supplying and distributing drugs in health area. So, this article studies a three-echelon pharmacological supply chain containing multi-distributor of raw materials, a pharmaceutical factory, and multi-drug distributors companies. The distributors of raw material order raw materials of some drugs to own suppliers and sell them to the pharmaceutical factory. The factory transmutes raw materials to the several finished products and sells them to some drug distributors companies. There are several types of raw materials and finished products. Here, it is supposed that the market powers of partners are different. So, the Stackelberg game among the members of the chain is deemed to analyze the coordination behavior of the members of the proposed chain. The aim of the research is to maximize the total profit of supply chain by employing the optimal pricing and ordering decision policies where the order quantities of the distributors and the selling prices of pharmaceutical factory (manufacturer) and the distributors are the decision variables. Besides, the closed form solutions of the decision variables are presented. At the end, numerical example and some sensitivity analysis are presented

A Hybrid Meta-Heuristic Method to Optimize Bi-Objective Single Period Newsboy Problem with Fuzzy Cost and Incremental Discount

In this paper the real-world occurrence of the multiple-product multiple-constraint single period newsboy problem with two objectives, in which there is incremental discounts on the purchasing prices, is investigated. The constraints are the warehouse capacity and the batch forms of the order placements. The first objective of this problem is to find the order quantities such that the expected profit is maximized and the second objective is maximizing the service rate. It is assumed that holding and shortage costs, modeled by a quadratic function, occur at the end of the period, and that the decision variables are integer. A formulation to the problem is presented and shown to be an integer nonlinear programming model. Finally, an efficient hybrid algorithm of harmony search, goal programming, and fuzzy simulation is provided to solve the model. The results are illustrated by a numerical example

Multi products single machine economic production quantity model with multiple batch size

In this paper, a multi products single machine economic order quantity model with discrete delivery is developed. A unique cycle length is considered for all produced items with an assumption that all products are manufactured on a single machine with a limited capacity. The proposed model considers different items such as production, setup, holding, and transportation costs. The resulted model is formulated as a mixed integer nonlinear programming model. Harmony search algorithm, extended cutting plane and particle swarm optimization methods are used to solve the proposed model. Two numerical examples are used to analyze and to evaluate the performance of the proposed model

Online peer-to-peer lending platform and supply chain finance decisions and strategies

Online peer-to-peer (P2P) lending platform is an emerging FinTech business model that establishes a link between investors and recipients of capital in supply chains (SCs). Businesses face capital constraints impacting directly on their final product price and demand. This article studies optimal decisions and operational strategies in a logistics network considering two capital-constrained manufacturers who produce products of different qualities and sell them to a retailer having deterministic demand over a specific period. The high quality product manufacturer borrows capital through an online P2P lending platform with a service fee, while the low quality product manufacturer pre-sells products for competing with the high quality product manufacturer. In this study, we find optimal prices of the SC participants, service rate of the online P2P platform and percentage of the pre-ordering quantity of the retailer. We analyse optimal Stackelberg and Nash equilibrium of the SC participants. We find that an increase in the amount of opportunity cost will cause a decrease in the pre-ordering quantity of the retailer affecting the SC profit in numerous ways. The online P2P lending platform should consider the amount of the retailer’s target profit in determining the platform’s service rate. We posit some practical insights based on our numerical study and observations for SC managers enabling them to take appropriate measures about their optimal strategies according to the networks’ existing economic conditions

An EOQ model with partial backordering with regard to random yield: two strategies to improve mean and variance of the yield

This paper presents an economic order quantity (EOQ) inventory model with partial backordering, where a buyer purchases its required products from a supplier. Each received batch from the supplier includes a random proportion of defective items. In other words, supplier's production process works to a random yield. A recursive solution method to find the optimal values for main decision variables is examined through a series of numerical examples. Moreover, it is considered that the yield can be improved at a given cost. To this extent, two ways to achieve the yield improvement have been considered: the first way is investment in order to improve the mean of the yield to an ideal value, and the second way is investment to reduce the yield variability to an acceptable value. The impacts of the proposed strategies are investigated through some numerical analysis and managerial insights are proposed

Optimizing vendor-managed inventory systems with limited storage capacity and partial backordering under stochastic demand

A supply chain member’s coordination is a challenging issue and a key factor of success in business markets. In vendor-managed inventory systems, the vendor makes replenishment decisions at the site of buyer by which the supply chain can be coordinated more efficiently. Two integrated vendor managed inventory systems under continuous review and periodic review replenishment policies are developed considering partial backordering and limited storage capacity at the buyer’s side. Furthermore, traditional retailer managed inventory systems under the same settings are developed to compare against the integrated systems. Efficient algorithms are presented to derive the optimal values of decision variables. Finally, numerical experiments and comprehensive sensitivity analysis are used to show the applicability and efficiency of the proposed VMI systems

Assessment of risk-sharing ratio with considering budget constraint and disruption risk under a triangular Pythagorean fuzzy environment in public–private partnership projects

The public-private partnership (PPP) is a practical and standard model that has been at the center of attention over the past two decades. Sharing risk between government and investors has been a challenging issue over the last year. This study formulates a model that aims to define the investors' longing and allocate risks to the government in a logical range. Besides, in some real-world conditions, foreign investors with lower cost, higher quality, and better technology than domestic investors partner with the government. Under this condition, it is essential to consider the disruption risks because of sanctions and currency price fluctuations. Furthermore, the limited budget of the government for investing in infrastructure projects is intended. In this paper, the government's disruption risks and limited budget are added to the risk-sharing ratio model for the first time in literature. Moreover, the Pythagorean fuzzy sets (PFSs) are applied to cope with the uncertainty of real-world conditions. The PFSs are more potent than classical and intuitionistic fuzzy sets (IFSs) in dealing with uncertainty. The PFSs provide the membership, non-membership, and hesitancy degree for experts to better address the derived uncertainty of real-world conditions. Also, compared with the IFSs, PFSs prepare more space, consequently providing more freedom to address the uncertainty. Finally, a case study is presented to illustrate the applicability and susceptibility of the suggested model. As disruption risks increase, general utility degree, government utility, and investor's effort decrease, and the guarantee risk ratio by government increases. Note that, investor's effort decreases because the government is forced to give the unfinished project to the domestic investor; consequently, exclusive terms arise for the domestic investor.Web of Science203art. no. 11724