Title: An integrated inventory model for vendor-customer coordination in a supply chain

Authors: D.K. Shaw, A. Mishra, D.A. Khan

Addresses: Department of Computer Applications, National Institute of Technology, Jamshedpur – 831014, Jharkhand, India. ' Department of Computer Applications, National Institute of Technology, Jamshedpur – 831014, Jharkhand, India. ' Department of Computer Applications, National Institute of Technology, Jamshedpur – 831014, Jharkhand, India

Abstract: The present study focuses on determining economic ordering quantity (EOQ) and shipping strategy of an inventory system integrated with a single-product, single-vendor and multi-customer scenario. Depending on the demand of all customers, production and shipping policies are determined and present a suitable model to illustrate the transferring of equally-sized batches. Optimum values of the decision variables are determined using a direct search method. In order to justify the lot-splitting approach for solving the integrated inventory problem, alternative model with no lot splitting are devised and tested under the same circumstances which produce similar or better results. A numerical example and related sensitivity analysis are given to show the effectiveness of the proposed model.

Keywords: inventory modelling; shipping time; supply chain management; SCM; economic order quantity; EOQ; buyer-supplier relationship; lot splitting; vendor-customer coordination.

DOI: 10.1504/IJBPSCM.2011.041378

International Journal of Business Performance and Supply Chain Modelling, 2011 Vol.3 No.2, pp.181 - 194

Received: 23 Sep 2010
Accepted: 19 May 2011

Published online: 30 Sep 2014 *

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