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Integrated pricing and supplier selection in a two-stage supply chain

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  • Adeinat, Hamza
  • Ventura, Jose A.

Abstract

This article presents an inventory replenishment model with supplier selection and pricing decisions in a two-stage supply chain consisting of a manufacturer stage followed by a retailer stage. A decision maker controls both stages. The manufacturer can procure the required raw material from a list of potential suppliers, each of whom has restrictions regarding capacity and quality. In this model, the manufacturer periodically replenishes the retailer's inventory, whose demand is sensitive to price changes. We propose a mixed integer nonlinear programming model designed to determine the number of orders placed to the selected suppliers per order cycle, the amount of inventory replenished at each stage, and the selling price that maximizes the profit per time unit. Additionally, we provide upper and lower bounds for the retailer's selling price and for the manufacturer's lot size multiplicative factor, which results in a tight feasible search space.

Suggested Citation

  • Adeinat, Hamza & Ventura, Jose A., 2018. "Integrated pricing and supplier selection in a two-stage supply chain," International Journal of Production Economics, Elsevier, vol. 201(C), pages 193-202.
    • Handle: RePEc:eee:proeco:v:201:y:2018:i:c:p:193-202
    DOI: 10.1016/j.ijpe.2018.03.021
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    References listed on IDEAS

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    2. Liu, Zhimin & Qu, Shaojian & Goh, Mark & Wu, Zhong & Huang, Ripeng & Ma, Gang, 2020. "Two-stage mean-risk stochastic optimization model for port cold storage capacity under pelagic fishery yield uncertainty," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 541(C).
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    4. José A. Ventura & Boaz Golany & Abraham Mendoza & Chenxi Li, 2022. "A multi-product dynamic supply chain inventory model with supplier selection, joint replenishment, and transportation cost," Annals of Operations Research, Springer, vol. 316(2), pages 729-762, September.
    5. Adeinat, Hamza & Pazhani, Subramanian & Mendoza, Abraham & Ventura, Jose A., 2022. "Coordination of pricing and inventory replenishment decisions in a supply chain with multiple geographically dispersed retailers," International Journal of Production Economics, Elsevier, vol. 248(C).
    6. Zongyu Mu & Yuangang Zheng & Hao Sun, 2021. "Cooperative Green Technology Innovation of an E-Commerce Sales Channel in a Two-Stage Supply Chain," Sustainability, MDPI, vol. 13(13), pages 1-28, July.
    7. Qingsheng Zhu & Kai Gao & Jia-Bao Liu, 2023. "Cloud model for new energy vehicle supply chain management based on growth expectation," Journal of Combinatorial Optimization, Springer, vol. 45(5), pages 1-23, July.

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