Title: Jointed inventory model on ordering and pricing: an extension for the newsboy model

Authors: Bin Liu, Robin G. Qiu, Sifeng Liu, Jian Chen

Addresses: Department of Management Science, Henan Agricultural University, Zhengzhou 450002, China. ' College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 210016, China. ' College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 210016, China. ' School of Economics and Management, Tsinghua University, Nanjing 100086, China

Abstract: As a study foundation of supply chain coordination, the newsboy model and its extensions have attracted more and more scholars in the recent years. This paper investigates the jointed inventory problem on ordering and pricing for a short-life-cycle product. For a product characterised by a single manufacturing cycle and two selling periods, we depict the jointed decision problem from the view of the centralised system with a stochastic dynamic programming model and develop a jointed decision method for its ordering and pricing. Then, we design an iterative search algorithm to find the optimal decision vectors. Finally, we analyse the characteristics of the decision by running simulation examples.

Keywords: newsboy model; inventory modelling; ordering; pricing; stochastic dynamic programming; iterative search algorithm; supply chain coordination; supply chain management; SCM; short life cycle; simulation.

DOI: 10.1504/IJSOI.2007.012693

International Journal of Services Operations and Informatics, 2007 Vol.2 No.1, pp.65 - 80

Published online: 08 Mar 2007 *

Full-text access for editors Full-text access for subscribers Purchase this article Comment on this article