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Optimal vendor selection in a multiproduct supply chain with truckload discounts

Author

Listed:
  • Glickman, Theodore S.
  • White, Susan C.

Abstract

When products are sold by multiple vendors in various locations, the purchaser must decide what to order from each vendor and where to send it. To solve this decision problem, a novel optimization model is developed and applied to a situation involving the nationwide wholesale distribution of grocery products. Comparing the model's solution with the actual record of shipments reveals instances in which the model selected higher-priced vendors in order to capitalize on truckload cost savings, which are seen to be an important factor in vendor selection. Additional models are developed to reduce computation time and assign shipments to vehicles.

Suggested Citation

  • Glickman, Theodore S. & White, Susan C., 2008. "Optimal vendor selection in a multiproduct supply chain with truckload discounts," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 44(5), pages 684-695, September.
    • Handle: RePEc:eee:transe:v:44:y:2008:i:5:p:684-695
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    Citations

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    Cited by:

    1. Fang Fang & Harihara Prasad Natarajan, 2020. "Sourcing and Procurement Cost Allocation in Multi‐Division Firms," Production and Operations Management, Production and Operations Management Society, vol. 29(3), pages 767-787, March.
    2. Tsao, Yu-Chung & Lu, Jye-Chyi, 2012. "A supply chain network design considering transportation cost discounts," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(2), pages 401-414.
    3. Li, Feng & Du, Timon C. & Wei, Ying, 2021. "With whom should I work? Ratings consideration for partner selection in a P2P supply chain network," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 152(C).

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