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Optimizing pricing, replenishment and rework decision for imperfect and deteriorating items in a manufacturer-retailer channel

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  • Chen, Tsung-Hui

Abstract

In an imperfect manufacturing system, the production cost, inventory holding cost, and the performance of the supply chain are usually affected by imperfect items. Many studies focus on developing inspection and rework models for an imperfect manufacturing system, but few develop models for deteriorating items. The present study deals with the imperfect manufacturing system problem using the case of a two-echelon supply chain consisting of one manufacturer and one retailer. The non-cooperation and cooperation policies were used to investigate the combined effects of the pricing scheme, the replenishment program, imperfect quality, and the rework process for the deteriorating items. Several numerical studies have shown the effects of changing parameters on decision-making, and the sensitivity of profit improvement on the whole channel.

Suggested Citation

  • Chen, Tsung-Hui, 2017. "Optimizing pricing, replenishment and rework decision for imperfect and deteriorating items in a manufacturer-retailer channel," International Journal of Production Economics, Elsevier, vol. 183(PB), pages 539-550.
  • Handle: RePEc:eee:proeco:v:183:y:2017:i:pb:p:539-550
    DOI: 10.1016/j.ijpe.2016.08.015
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    References listed on IDEAS

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    1. Yunlong Yu & Tiaojun Xiao & Zhangwei Feng, 2020. "Price and cold-chain service decisions versus integration in a fresh agri-product supply chain with competing retailers," Annals of Operations Research, Springer, vol. 287(1), pages 465-493, April.
    2. Chua, Geoffrey A. & Mokhlesi, Reza & Sainathan, Arvind, 2017. "Optimal Discounting and Replenishment Policies for Perishable Products," International Journal of Production Economics, Elsevier, vol. 186(C), pages 8-20.

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