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Note---On "A Quantity Discount Pricing Model to Increase Vendor Profits"

Author

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  • Avijit Banerjee

    (Department of Quantitative Business Analysis, College of Business Administration, Louisiana State University, Baton Rouge, Louisiana 70803)

Abstract

Monahan (Monahan, James P. 1984. A quantity discount pricing model to increase vendor profits. Management Sci. 30 (June) 720--726.) develops a model for establishing an optimal quantity discount schedule from a vendor's viewpoint. In this note we show that this model is limited to the case where the vendor buys from another supplier. Incorporating vendor's inventory carrying costs, we develop a generalized version of Monahan's model and demonstrate its equivalence with the joint economic lot size approach suggested by Banerjee (Banerjee, Avijit. 1986. A joint economic lot size model for purchaser and vendor. Decision Sci. 17 (Summer) 292--311.).

Suggested Citation

  • Avijit Banerjee, 1986. "Note---On "A Quantity Discount Pricing Model to Increase Vendor Profits"," Management Science, INFORMS, vol. 32(11), pages 1513-1517, November.
    • Handle: RePEc:inm:ormnsc:v:32:y:1986:i:11:p:1513-1517
    DOI: 10.1287/mnsc.32.11.1513
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    Citations

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    Cited by:

    1. Toptal, Aysegül, 2009. "Replenishment decisions under an all-units discount schedule and stepwise freight costs," European Journal of Operational Research, Elsevier, vol. 198(2), pages 504-510, October.
    2. Kim, Seung-Lae & Ha, Daesung, 2003. "A JIT lot-splitting model for supply chain management: Enhancing buyer-supplier linkage," International Journal of Production Economics, Elsevier, vol. 86(1), pages 1-10, October.
    3. Benton, W. C. & Park, Seungwook, 1996. "A classification of literature on determining the lot size under quantity discounts," European Journal of Operational Research, Elsevier, vol. 92(2), pages 219-238, July.
    4. Beullens, Patrick & Janssens, Gerrit K., 2014. "Adapting inventory models for handling various payment structures using net present value equivalence analysis," International Journal of Production Economics, Elsevier, vol. 157(C), pages 190-200.
    5. Zimmer, Kirstin, 2002. "Supply chain coordination with uncertain just-in-time delivery," International Journal of Production Economics, Elsevier, vol. 77(1), pages 1-15, May.
    6. Zavanella, Lucio & Zanoni, Simone, 2009. "A one-vendor multi-buyer integrated production-inventory model: The 'Consignment Stock' case," International Journal of Production Economics, Elsevier, vol. 118(1), pages 225-232, March.
    7. Beullens, Patrick, 2014. "Revisiting foundations in lot sizing—Connections between Harris, Crowther, Monahan, and Clark," International Journal of Production Economics, Elsevier, vol. 155(C), pages 68-81.
    8. Abhishek Chakraborty, 2021. "A surcharge pricing policy for supply chain coordination under the just-in-time (JIT) environment in the presence of backordering," OPSEARCH, Springer;Operational Research Society of India, vol. 58(4), pages 1049-1076, December.
    9. Konur, Dinçer & Toptal, Ayşegül, 2012. "Analysis and applications of replenishment problems under stepwise transportation costs and generalized wholesale prices," International Journal of Production Economics, Elsevier, vol. 140(1), pages 521-529.
    10. Noori-Daryan, Mahsa & Taleizadeh, Ata Allah & Jolai, Fariborz, 2019. "Analyzing pricing, promised delivery lead time, supplier-selection, and ordering decisions of a multi-national supply chain under uncertain environment," International Journal of Production Economics, Elsevier, vol. 209(C), pages 236-248.
    11. Bylka, Stanislaw, 2009. "Non-cooperative strategies for production and shipments lot sizing in the vendor-buyer system," International Journal of Production Economics, Elsevier, vol. 118(1), pages 243-252, March.
    12. Banerjee, Avijit & Kim, Seung-Lae & Burton, Jonathan, 2007. "Supply chain coordination through effective multi-stage inventory linkages in a JIT environment," International Journal of Production Economics, Elsevier, vol. 108(1-2), pages 271-280, July.
    13. Qiu, Xuan & Lee, Chung-Yee, 2019. "Quantity discount pricing for rail transport in a dry port system," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 122(C), pages 563-580.
    14. Lee, Chang Hwan, 2001. "Coordinated stocking, clearance sales, and return policies for a supply chain," European Journal of Operational Research, Elsevier, vol. 131(3), pages 491-513, June.
    15. Sarmah, S.P. & Acharya, D. & Goyal, S.K., 2006. "Buyer vendor coordination models in supply chain management," European Journal of Operational Research, Elsevier, vol. 175(1), pages 1-15, November.

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