Profit models and optimisation for a multi-item-multi-echelon distribution system
by Yingjun Wang, Junjun Gao
International Journal of Services Operations and Informatics (IJSOI), Vol. 1, No. 4, 2006

Abstract: A multiechelon Distribution System (DS) with multiple products is researched in this paper, where multiple manufacturers (M), one Regional Distribution Centre (RDC) (D) and multiple retailers (R) are involved facing normal distribution demand at the market. Firstly, the expected profit models are deduced for each member in this DS. Secondly, manufacturers and RDC's joint optimisation models (M-D models) and RDC and retailers' joint optimisation models (D-R models) are developed and solved to obtain the optimal Order-Up-to Levels (OULs) for different products at different stages in the DS under the constraints of 'weighted' service levels. Finally, two calculation examples are given to illustrate the solving process of OULs for the models.

Online publication date: Thu, 25-Jan-2007

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