Coordinating the Multi-retailer, Single Supplier Procurement Processes for a Seasonal Product with Supply Contracts PDF Download
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Author: Craig Kanoa Prisby
Publisher:
ISBN:
Category :
Languages : en
Pages : 25
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Book Description
Supply contracts are used to maximize profits in a supply chain by coordinating order quantities between the suppliers and retailers. In traditional supply contracts, retailers use a newsvendor approach to maximize their profits, while the supplier's profits increase linearly as a function of the number of units supplied to retailers. Initially, retailers assume risk in the supply chain because they are facing an unknown demand, and the suppliers assume no risk. This thesis looks at an example from the garment industry where retailers order to replenish stock after a small assortment buy is placed at the start of the finite selling season. The suppliers must place production orders for the entire selling season before the selling season begins. It is clear see that the retailers assume little risk in this model, while the supplier faces significant risk, especially if its forecasting methods are not accurate. The levels of risk that each assumes in this model are reversed when compared to the traditional supply contract model. A method is developed that coordinates the retailer ordering with the supplier's production schedule. It is shown that coordinating the supply chain's ordering will lead to higher profits than the current, uncoordinated model.
Author: Craig Kanoa Prisby
Publisher:
ISBN:
Category :
Languages : en
Pages : 25
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Book Description
Supply contracts are used to maximize profits in a supply chain by coordinating order quantities between the suppliers and retailers. In traditional supply contracts, retailers use a newsvendor approach to maximize their profits, while the supplier's profits increase linearly as a function of the number of units supplied to retailers. Initially, retailers assume risk in the supply chain because they are facing an unknown demand, and the suppliers assume no risk. This thesis looks at an example from the garment industry where retailers order to replenish stock after a small assortment buy is placed at the start of the finite selling season. The suppliers must place production orders for the entire selling season before the selling season begins. It is clear see that the retailers assume little risk in this model, while the supplier faces significant risk, especially if its forecasting methods are not accurate. The levels of risk that each assumes in this model are reversed when compared to the traditional supply contract model. A method is developed that coordinates the retailer ordering with the supplier's production schedule. It is shown that coordinating the supply chain's ordering will lead to higher profits than the current, uncoordinated model.
Author: Fred Sollish
Publisher: John Wiley & Sons
ISBN: 0470130881
Category : Business & Economics
Languages : en
Pages : 483
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Book Description
The Procurement and Supply Manager's Desk Reference "Finally, a cohesive volume written for the worldwide profession of purchasing and supply chain management." —James D. Reeds, CPM, CFPIM, CIRM, CPCM, President, Institute for Supply Management-Silicon Valley "Great resource. This work is educational, informative, and certainly, most practical." —Peter Sterlacci, Director, Professional Development, San Jose State University "Complete with useful information-the authors are extraordinary experts in the field of supply chain management." —Michael Geraghty, MBA, President, Geraghty International, and author of Anybody Can Negotiate—Even You! Destined to become every supply manager's essential desktop tool with in-depth, authoritative coverage of each topic Leaving no stone unturned in covering all aspects of the purchasing and sourcing function, The Procurement and Supply Manager's Desk Reference is filled with everything every supply manager needs to know about the key roles and responsibilities of a procurement manager. Filled with practical aids such as checklists and customizable forms, this essential book provides an easy-to-use road map for the supply manager in the new millennium. With an eye toward incorporating proactive strategies and best practices, The Procurement and Supply Manager's Desk Reference offers detailed coverage and tips on: Procurement and Best Business Practices Sourcing Management How to select suppliers and measure performance The best way to leverage computer systems Providing value to the organization Identifying those strategies that will work best for your business for years to come
Author: Saba Salimi
Publisher:
ISBN:
Category :
Languages : en
Pages : 122
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Book Description
Over past few years, supply chain coordination has been widely studied and numerous practitioners and researchers proposed many models on this field. Although many previous studies addressed channel competition considering a scenario with an exclusive retailer with only one producer’s brand, in real world the retailers sell various products with different brands. This study was to analyze the relation between two suppliers and a common retailer by taking various degree of product sustainability into account. The market is considered to be duopoly. This thesis describes modifying and implementation of a supply chain coordinator tool in order to enhance the profit earned by any of the parties involved in this supply chain. In this thesis we present a cooperation and collaboration model in a supply chain consisting of two suppliers with a common retailer. We establish the conditions for cooperation in such scenario with popular supply chain contracts. Even though other methods have been reviewed under various scenarios, we confine our interest to apply a coordinating contract and analyse the results. The type of the contract that can coordinate the supply chain is debatable and it needs to be analyzed depending on the limitations. The methodological approach taken in this study is modifying a contract in order to coordinate the supply chain and leads to better off for all parties. First we consider the classical model then the whole sale price contract is applied. Later in order to enable the supply chain coordination, facility sharing contract and franchise contract have been modified and implemented. Finally by illustrating the results of implementing each contract, a framework is presented. In this study the linear demand function is used because of tractability in providing analytical results while in real case the nonlinear demand function is widely used.
Author: Sridhar Tayur
Publisher: Springer Science & Business Media
ISBN: 1461549493
Category : Business & Economics
Languages : en
Pages : 851
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Book Description
Quantitative models and computer-based tools are essential for making decisions in today's business environment. These tools are of particular importance in the rapidly growing area of supply chain management. This volume is a unified effort to provide a systematic summary of the large variety of new issues being considered, the new set of models being developed, the new techniques for analysis, and the computational methods that have become available recently. The volume's objective is to provide a self-contained, sophisticated research summary - a snapshot at this point of time - in the area of Quantitative Models for Supply Chain Management. While there are some multi-disciplinary aspects of supply chain management not covered here, the Editors and their contributors have captured many important developments in this rapidly expanding field. The 26 chapters can be divided into six categories. Basic Concepts and Technical Material (Chapters 1-6). The chapters in this category focus on introducing basic concepts, providing mathematical background and validating algorithmic tools to solve operational problems in supply chains. Supply Contracts (Chapters 7-10). In this category, the primary focus is on design and evaluation of supply contracts between independent agents in the supply chain. Value of Information (Chapters 11-13). The chapters in this category explicitly model the effect of information on decision-making and on supply chain performance. Managing Product Variety (Chapters 16-19). The chapters in this category analyze the effects of product variety and the different strategies to manage it. International Operations (Chapters 20-22). The three chapters in this category provide an overview of research in the emerging area of International Operations. Conceptual Issues and New Challenges (Chapters 23-27). These chapters outline a variety of frameworks that can be explored and used in future research efforts. This volume can serve as a graduate text, as a reference for researchers and as a guide for further development of this field.
Author: Marcel Sieke
Publisher: Springer
ISBN: 3658243821
Category : Business & Economics
Languages : en
Pages : 158
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Book Description
In recent years, the design of contracts in supply chains has received significant attention from researchers and practitioners. Companies try to improve their profits by designing efficient contracts that ensure a high availability of the product at a low cost. In this book the author presents a quantitative approach for designing optimal supply chain contracts. Firstly, service level contracts, which are frequently used between a supplier and a manufacturer, are analyzed. For this contract type, optimal contract parameter combinations are identified that lead to a coordinated supply chain. Secondly, an optimal contract selection strategy is developed for a supply chain where a manufacturer can choose among multiple potential buyers. Potential readership includes scholars of supply chain management and management science, graduate students interested in these areas as well as interested practitioners involved in negotiating contracts.
Author: Lisha Duan
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
Given the popularity of inventory models with supplier selection, this research aims to develop mathematical models for the integrated procurement, inventory planning, and pricing problems in the presence of multiple capacitated suppliers and price-sensitive demand in supply chains, simultaneously determining the selling pricing and inventory policy under a variety of supply contracts. We starts with the development of an operational planning model in a demand-driven serial supply chain with multiple capacitated suppliers. Taking into account delivery time and order frequency, the suppliers offer a novel price break scheme, which is beneficial to both the supplier and the buyer. A mixed-integer linear programming (MILP) formulation is developed to address this dynamic supplier selection and inventory management model aiming at minimizing the overall incurred cost across the entire supply chain with capacity constraints in production, inventory, and transportation. Then, the length of the time period is considered as a variable. A new MILP formulation is derived when each period of the model is split into multiple sub-periods, and under certain conditions, it is proved that the optimal solution and objective value of the original model form a feasible solution and an upper bound for the derived model. Sufficient evidence demonstrates that the length of the time period has a significant influence on supplier selection, lot sizing allocation, and inventory planning decisions. Then, we investigate joint decision making of supplier selection, pricing, and inventory lot-sizing in a two-stage supply chain, where suppliers feature certain capacity and quality levels and the retailer faces a price-sensitive demand, characterized by the logit function. Multiple orders can be placed to potential suppliers within a repeating order cycle. The retailer purchases the items satisfying a lower bound on the average quality level to meet customer demand. In this context, we develop a mathematical model to find an optimal solution for the selling price and inventory replenishment policy, including the set of selected suppliers, order frequency, and order quantity. We further derive a lower bound on the optimal retail price and based on a two-stage piecewise linear approximation (PLA) technique, we develop heuristic algorithms to yield near-optimal solutions to the proposed model. Besides, we provide sufficient justification for the selection of the logit demand function as well as a comparison with other demand functions. A numerical study further suggests the importance of using a precise demand curve to select the set of suppliers, coordinate inventory, and accurately optimize the profit function. Next, we extend the joint pricing, supplier selection and inventory replenishment model to a serial supply chain with multiple stages in a centralized control scenario. Within this supply chain, the first stage faces a supplier selection decision for a particular product that experiences a price-sensitive demand. The buying stage needs to decide which suppliers to choose and how to allocate orders, determining the optimal inventory policy for all stages and the retail price to offer to end customers, while maximizing the total profit of the supply chain. The problem is formulated as a mixed integer nonlinear programming (MINLP) model and a heuristic algorithm is proposed to overcome the complexity of the model. Then, we analyze a special case that considers only one uncapacitated supplier and one buyer. An efficient heuristic is developed and computational experiments are carried out to examine the performance of the proposed heuristics. In addition, we provide a series of numerical examples to illustrate our results and analyze the impact of the parameters within a sensitivity analysis. Finally, we study a pricing and purchasing problem in a two-stage supply chain with one supplier and one retailer, where the retailer faces the price-sensitive demand and the supplier coordinates the supply chain with controllable delivery deviation. Both the retailers demand and the suppliers lead time are stochastic. A risk sharing supply contract is adopted and the supplier compensates the retailer by paying a portion of penalties for early/late delivery. In this direction, we establish a model with a game-theoretic approach to achieve supply chain coordination, simultaneously determining the retailers selling price, order quantity, and order date as well as the suppliers lead time variance. Besides, the models with respect to the constant delivery deviation are also developed and analyzed. Finally, a numerical example is presented and sensitivity analysis regarding the pricing and penalty parameters provide in-depth managerial insights for decision makers.
Author: Arvind Sainathan
Publisher:
ISBN:
Category :
Languages : en
Pages : 30
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Book Description
The paper studies coordination of a supply chain when the inventory is managed by the vendor (VMI). We also provide a general mathematical framework that can be used to analyze contracts under both retailer managed inventory (RMI) and VMI. Using a simple news-vendor scenario with a single vendor and single retailer, we study five popular coordinating supply chain contracts: buyback, quantity flexibility, quantity discount, sales rebate, and revenue sharing contracts. We analyze the ability of these contracts to coordinate the supply chain under VMI when the vendor freely decides the quantity. We find that even though all of them coordinate under RMI, quantity flexibility and sales rebate contracts do not generally coordinate under VMI. Furthermore, buyback and revenue sharing contracts are equivalent. Hence, we propose two new contracts which coordinate under VMI (one of which coordinates under RMI too, provided a well-known assumption holds). Finally, we extend our analysis to consider multiple independent retailers with the vendor incurring linear or convex production cost, and show that our results are qualitatively unchanged.
Author: David N. Burt
Publisher: McGraw Hill Professional
ISBN: 0071770615
Category : Business & Economics
Languages : en
Pages : 770
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Book Description
Resource added for the Business Management program 101023.
Author: Zhaolin Li
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Book Description
This research investigates how to design procurement mechanisms for assortment planning. A retailer buys directly from a manufacturer who possesses private information about the per unit variable cost and per variety setup cost. We first develop a screening model to assist the retailer in integrating assortment planning into supply chain procurement processes when only one manufacturer is available. We demonstrate that the screening mechanism is optimal among all feasible procurement strategies. When there are multiple competing manufacturers, we propose a supply contract auctioning mechanism and evaluate its performance. In this mechanism, the retailer announces a contract menu and the manufacturer that bids the highest upfront fee paid to the retailer wins the auction. The winner then chooses and executes a contract from the contract menu. We show that when the retailer uses the optimal screening contract menu as the object in the auction, it achieves the optimal procurement outcome if the screening contract menu does not pay rent to any manufacturer type. This finding sheds light on the connection between screening and auction mechanisms when there exists multi-dimensional private information.
Author: Joris J.A. Leeman
Publisher: BoD – Books on Demand
ISBN: 3751984577
Category : Business & Economics
Languages : en
Pages : 362
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Book Description
The purpose of this book is to help you with the development and implementation of a successful End-to-End Supply Chain Management - Strategy: optimising your processes from manufacturer to retailer. This book answers four questions: - How to develop an end-to-end supply chain - strategy? - How to create the necessary supply chain infrastructure? - How to make collaboration work between the partners in the network? - How to plan and manage the supply chain flows? It will enable you to: - Systematically improve your sales productivity in the retail stores; - Enhance the operational / qualitative performance of your processes and those of your partners in the supply chain; - More effectively balance the trade-off Time v Costs. This book provides you with: - A Supply Chain System - Model: a framework to develop your End-to-End Supply Chain; - 10 Strategic Building Blocks which can be used as a toolkit; - 50 Lessons Learned based on experiences from practice; - A strategic roadmap: to plan, organise, lead and control your supply chain. The 2nd edition (in hardcover and color) has many new cases, toolboxes and a new chapter on process management. In addition, more attention is given to topics like procurement, demand planning, omnichanneling and supply chain-design, -planning and -execution. For whom has this book been written? This book is useful for thinkers and practitioners! For everyone who wants to learn more about supply chain management and the development and implementation of an end-to-end supply chain strategy. This book is also available as paperback in black and white with the title Supply Chain Management, 2nd edition.
