Joint ordering policy for a conditional trade credit model with two retailers Online publication date: Fri, 01-Jul-2022
by Zhen Zhang; Song-Tao Zhang; Ming-Shi Yue
European J. of Industrial Engineering (EJIE), Vol. 16, No. 4, 2022
Abstract: This paper focuses on the cooperation mechanism between two retailers. To reduce the average processing cost, the supplier usually sets a threshold for trade credit to stimulate retailers' orders. Retailers can enjoy permissible delay in payments only when their order quantities are more than or equal to the given threshold. However, considering the diversity of retailers, the motivation effect of the threshold is limited. To resolve the problem, the supplier can additionally provide its retailers with a joint-ordering policy under which they can make delayed payments as long as their total order quantity meets the required threshold. We provide a mutually acceptable order-allocation scheme for two retailers, and determine the optimal payment methods for them. In addition, an optimal threshold is identified for the supplier to maximise the total order quantity of retailers. Based on this, some managerial insights are obtained. [Submitted: 27 February 2020; Accepted: 8 April 2021]
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the European J. of Industrial Engineering (EJIE):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email subs@inderscience.com
Our Blog 
Follow us on Twitter 
Visit us on Facebook