Impacts of Transportation Cost on Distribution-Free Newsboy Problems

Shu, Ming‐Hung; Yeh, Chun-Wu; Fu, Yen-Chen

doi:10.1155/2014/307935

Cited by 5 publications

(4 citation statements)

References 23 publications

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“…Additionally, they provided an upper bound for the freight cost beyond which it becomes unprofitable to place any order with the supplier. Shu et al [18] studied the impacts of transportation cost on distribution-free newsvendor problems. They formulated the transportation cost as a nonlinear regression function of the shipping quantity.…”

Section: Literature Reviewmentioning

confidence: 99%

Incorporating transportation costs into the single and multiple items newsvendor problems

Hariga

2024

PLoS ONE

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The efficiency and responsiveness of supply chains are vitally dependent on inventory replenishment and transportation decisions. In this paper, we study a supply chain consisting of a single retailer ordering seasonal products within the newsvendor framework. The primary objective of the paper is to investigate the retailer’s decision-making process, aimed at determining the optimal replenishment quantities and selecting the appropriate mix and size of the truck fleet. Initially, we formulate a mathematical model where the retailer exclusively manages a limited fleet of its own trucks for inbound transportation of a single seasonal product. In this context, we determine a lower breakeven point for the fixed transportation cost than what has been previously proposed in the literature. Subsequently, we examine a commonly encountered transportation scenario where the retailer has the opportunity to expand its fleet size by leasing trucks from the external market. The outcomes of the numerical example indicates that the flexibility resulting from the utilization of different types of trucks can lead to reduced overall costs. We also address the practical transportation problem of efficiently shipping various seasonal products solely with the retailer’s own trucks. For this complex problem, we propose an optimal solution procedure based on Lagrangian method. We show that the joint replenishment of multiple products results in cost savings and enhances utilization of the trucks’ capacities.

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Section: Literature Reviewmentioning

confidence: 99%

Incorporating transportation costs into the single and multiple items newsvendor problems

Hariga

2024

PLoS ONE

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“…They derived the closed-form formulas for the worst-case and best-case order quantities. Shu et al [17] considered the distribution-free single-period inventory management problem by borrowing an economic theory from transportation disciplines. Moon et al [18] found the differences between normal distribution approaches and distribution-free approaches in four scenarios with mean and variance.…”

Section: Introductionmentioning

confidence: 99%

A Multiproduct Single‐Period Inventory Management Problem under Variable Possibility Distributions

Guo

Tian

Liu

2017

Mathematical Problems in Engineering

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In multiproduct single-period inventory management problem (MSIMP), the optimal order quantity often depends on the distributions of uncertain parameters. However, the distribution information about uncertain parameters is usually partially available. To model this situation, a MSIMP is studied by credibilistic optimization method, where the uncertain demand and carbon emission are characterized by variable possibility distributions. First, the uncertain demand and carbon emission are characterized by generalized parametric interval-valued (PIV) fuzzy variables, and the analytical expressions about the mean values and second-order moments of selection variables are established. Taking second-order moment as a risk measure, a new credibilistic multiproduct single-period inventory management model is developed under mean-moment optimization criterion. Furthermore, the proposed model is converted to its equivalent deterministic model. Taking advantage of the structural characteristics of the deterministic model, a domain decomposition method is designed to find the optimal order quantities. Finally, a numerical example is provided to illustrate the efficiency of the proposed mean-moment credibilistic optimization method. The computational results demonstrate that a small perturbation of the possibility distribution can make the nominal optimal solution infeasible. In this case, the decision makers should employ the proposed credibilistic optimization method to find the optimal order quantities.

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“…Tajbakhsh [10] derived closedform expressions for the model of Moon and Choi [4]. Numerous models have been studied using the distributionfree approach [11][12][13][14][15][16]. For more details, one can refer to an extensive review of the literature provided by Qin et al [17].…”

Section: Introductionmentioning

confidence: 99%

The Distribution-Free Newsboy Problem with Multiple Discounts and Upgrades

Moon

Yoo

Saha

2016

Mathematical Problems in Engineering

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Most papers on the newsboy problem assume that excess inventory is either sold after discount or discarded. In the real world, overstocks are handled with multiple discounts, upgrades, or a combination of these measures. For example, a seller may offer a series of progressively increasing discounts for units that remain on the shelf, or the seller may use incrementally applied innovations aimed at stimulating greater product sophistication. Moreover, the normal distribution does not provide better protection than other distributions with the same mean and variance. In this paper, we find the differences between normal distribution approaches and distribution-free approaches in four scenarios with mean and variance of demand as the only available data to decision-makers. First, we solve the newsboy problem by considering multiple discounts. Second, we formulate and solve the newsboy problem by considering multiple upgrades. Third, we formulate and solve a mixed newsboy problem characterized with multiple discounts and upgrades. Finally, we extend the model to solve a multiproduct newsboy problem with a storage or a budget constraint and develop an algorithm to find the solutions of the models. Concavity of the models is proved analytically. Extensive computational experiments are presented to verify the robustness of the distribution-free approach. The results show that the distribution-free approach is robust.

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Impacts of Transportation Cost on Distribution-Free Newsboy Problems

Cited by 5 publications

References 23 publications

Incorporating transportation costs into the single and multiple items newsvendor problems

Incorporating transportation costs into the single and multiple items newsvendor problems

A Multiproduct Single‐Period Inventory Management Problem under Variable Possibility Distributions

The Distribution-Free Newsboy Problem with Multiple Discounts and Upgrades

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