Title: Profit models and optimisation for a multi-item-multi-echelon distribution system

Authors: Yingjun Wang, Junjun Gao

Addresses: Sydney Institute of Language and Commerce, Shanghai University, 20, Chengzhong Road, Shanghai 210800, PR China. ' Sydney Institute of Language and Commerce, Shanghai University, 20, Chengzhong Road, Shanghai 210800, PR China

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.

Keywords: supply chain management; SCM; multi-item-multi-echelon; MIME distribution systems; profit models; multi-item service levels; optimisation; multiple products; order-up-to levels.

DOI: 10.1504/IJSOI.2006.012163

International Journal of Services Operations and Informatics, 2006 Vol.1 No.4, pp.380 - 392

Published online: 25 Jan 2007 *

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