Dynamic Pricing and Inventory Management with Dual Suppliers of Different Lead Times and Disruption Risks

Gong, Xiting; Chao, Xiuli; Zheng, Shaohui

doi:10.1111/poms.12221

Cited by 64 publications

(29 citation statements)

References 33 publications

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“…More recently, Zhou and Chao (2014) address the dual-sourcing problem with price sensitive demand, a regular supplier with one-period leadtime and an expedited supplier with zero leadtime, and characterize the structure of the optimal policy. Gong et al (2014) further generalize the structural analysis to a dual-sourcing problem with price sensitive demand and Markovian supply interruptions. In both models, there are no capacity limits on the supplies.…”

Section: Related Literaturementioning

confidence: 99%

Preservation of Structural Properties in Optimization with Decisions Truncated by Random Variables and Its Applications

Chen

Gao

Pang

2018

Operations Research

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A common technical challenge encountered in many operations management models is that decision variables are truncated by some random variables and the decisions are made before the values of these random variables are realized, leading to non-convex minimization problems. To address this challenge, we develop a powerful transformation technique which converts a non-convex minimization problem to an equivalent convex minimization problem. We show that such a transformation enables us to prove the preservation of some desired structural properties, such as convexity, submodularity, and L-convexity, under optimization operations, that are critical for identifying the structures of optimal policies and developing efficient algorithms. We then demonstrate the applications of our approach to several important models in inventory control and revenue management: dual sourcing with random supply capacity, assemble-to-order systems with random supply capacity, and capacity allocation in network revenue management.

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Section: Related Literaturementioning

confidence: 99%

Preservation of Structural Properties in Optimization with Decisions Truncated by Random Variables and Its Applications

Chen

Gao

Pang

2018

Operations Research

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“…An extensive list of studies was published intending to present and problematize the concepts of fast fashion and QR in the Northern Hemisphere (Ghemawat & Nueno, 2003;Ferdows et al, 2004;Foroohar, 2006;Gumbel, 2009;Silva et al, 2011) and present relevant contributions to the study of this strategy. However, they have focused on the global performance of the organizations analyzed.…”

Section: Methodsmentioning

confidence: 99%

Adoção de Resposta Rápida e gerenciamento de estoques no fast fashion: dois estudos de caso em Minas Gerais

Golobovante¹,

Ribeiro

Gomes

2018

Gest. Prod.

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Resumo O modelo de negócio adotado por uma empresa deve ser alinhado à definição de estratégias operacionais, que concedam agilidade e flexibilidade necessárias aos suprimentos, à produção e à distribuição. A Resposta Rápida (Quick Response - QR) é uma estratégia operacional em crescimento nas indústrias e sua finalidade é reduzir o tempo despendido nas etapas de produção, para que seja possível desenvolver os produtos poucas semanas antes do período de venda. A QR é especialmente relevante para a estratégia de negócio denominada fast fashion, que exige giro de estoque elevado, inserção frequente de novos produtos nos pontos de venda, agilidade na cadeia de suprimentos (CS) e assertividade na identificação de tendências. O objetivo do artigo é identificar como essa estratégia pode ser operacionalizada via QR e gestão de estoques em dois estudos de caso na indústria de vestuário em Minas Gerais. O estudo adotou uma abordagem qualitativa, com documentação direta como técnica de pesquisa, o método de estudo de caso. Foi observado que uma empresa atua de acordo com a estratégia fast fashion, enquanto a outra – devido à falta de aplicação da QR e pouca eficiência na gestão dos estoques – não obteve sucesso na adoção dessa estratégia de negócios.

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“…Like previous studies (e.g., [8], [9], [15], [16]), we define the probability α i as the reliability of supplier i. We further suppose c L < c H and α L < α H ; that is, the low-cost supplier has low reliability [23], [24]. Thus, the manufacturer can obtain δ i Q r units of component from regular sourcing.…”

Section: Base Model a Model Descriptionmentioning

confidence: 99%

Dual Sourcing Strategy for High-Tech Manufacturer Under Supply Risk and Capacity Constraint

Zeng

2019

IEEE Access

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High-tech manufacturers frequently suffer from supply risk and capacity constraint. This paper considers a manufacturer who procures a type of high-tech component from two suppliers with asymmetric costs, capacities, and reliabilities, where the low-cost supplier has low reliability. One supplier is selected as a primary supplier and another as a backup supplier. The manufacturer places regular order to the primary supplier and determines backup order quantity from the backup supplier after random yield realization of the primary supplier. By developing a dynamic game-theoretical model, we obtain the optimal wholesale prices for the primary supplier and backup supplier, the optimal order quantity and supplier arrangement decisions for the manufacturer. We show that the manufacturer selects the low-cost supplier as a primary supplier and the high-cost supplier as a backup supplier (namely, LH policy) when the reliabilities of the two suppliers are close. When these reliabilities are not so close, the manufacturer chooses the high-cost supplier as a primary supplier and the low-cost supplier as a backup supplier (namely, HL policy). In addition, the manufacturer in the industry with scale diseconomies is more likely to select HL policy than that in the industry with scale economies. Compared with centralized decision making scheme, decentralized scheme induces the manufacturer more likely to select HL policy in the industry without scale economies, whereas in the industry with scale economies, decentralized scheme induces the manufacturer more likely to choose either HL policy when the capacity advantage of the low-cost supplier is weak, or LH policy when this advantage is significant. INDEX TERMS Supply chain management, supply and demand, production management, operations research, capacity constraint.

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Dynamic Pricing and Inventory Management with Dual Suppliers of Different Lead Times and Disruption Risks

Cited by 64 publications

References 33 publications

Preservation of Structural Properties in Optimization with Decisions Truncated by Random Variables and Its Applications

Preservation of Structural Properties in Optimization with Decisions Truncated by Random Variables and Its Applications

Adoção de Resposta Rápida e gerenciamento de estoques no fast fashion: dois estudos de caso em Minas Gerais

Dual Sourcing Strategy for High-Tech Manufacturer Under Supply Risk and Capacity Constraint

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