The paper investigates a two-echelon production-delivery supply chain model for products with stochastic demand and backorder-lost sales mixture under trade-credit financing. The manufacturer delivers the retailer’s order quantity in a number of equal-sized shipments. The replenishment lead-time is such that it can be crashed to a minimum duration at an additional cost that can be treated as an investment. Shortages in the retailer’s inventory are allowed to occur and are partially backlogged with a backlogging rate dependent on customer’s waiting time. Moreover, the manufacturer offers the retailer a credit period which is less than the reorder interval. The model is formulated to find the optimal solutions for order quantity, safety factor, lead time, and the number of shipments from the manufacturer to the retailer in light of both distribution-free and known distribution functions. Two solution algorithms are provided to obtain the optimal decisions for the integrated system. The effects of controllable lead time, backorder rate and trade-credit financing on optimal decisions are illustrated through numerical examples.
Keywords: Integrated model, lead time reduction, controllable backorder, trade-credit financing, distribution-free approach
@article{RO_2021__55_S1_S673_0,
author = {Sarkar, Sumon and Giri, Bibhas Chandra},
title = {Optimal ordering policy in a two-echelon supply chain model with variable backorder and demand uncertainty},
journal = {RAIRO. Operations Research},
pages = {S673--S698},
year = {2021},
publisher = {EDP-Sciences},
volume = {55},
doi = {10.1051/ro/2020007},
mrnumber = {4223106},
language = {en},
url = {https://www.numdam.org/articles/10.1051/ro/2020007/}
}
TY - JOUR AU - Sarkar, Sumon AU - Giri, Bibhas Chandra TI - Optimal ordering policy in a two-echelon supply chain model with variable backorder and demand uncertainty JO - RAIRO. Operations Research PY - 2021 SP - S673 EP - S698 VL - 55 PB - EDP-Sciences UR - https://www.numdam.org/articles/10.1051/ro/2020007/ DO - 10.1051/ro/2020007 LA - en ID - RO_2021__55_S1_S673_0 ER -
%0 Journal Article %A Sarkar, Sumon %A Giri, Bibhas Chandra %T Optimal ordering policy in a two-echelon supply chain model with variable backorder and demand uncertainty %J RAIRO. Operations Research %D 2021 %P S673-S698 %V 55 %I EDP-Sciences %U https://www.numdam.org/articles/10.1051/ro/2020007/ %R 10.1051/ro/2020007 %G en %F RO_2021__55_S1_S673_0
Sarkar, Sumon; Giri, Bibhas Chandra. Optimal ordering policy in a two-echelon supply chain model with variable backorder and demand uncertainty. RAIRO. Operations Research, Tome 55 (2021), pp. S673-S698. doi: 10.1051/ro/2020007
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