Abstract
Studies about supply chain coordination have emphasised maximising the profit of the overall supply chain, but the profit changes of individual members in the supply chain have often been overlooked. It has been shown that profit increment of the whole supply chain may not be beneficial for every individual member. Therefore, the use of quantity discounts to achieve the coordination of a supply chain is discussed in this article. A two-echelon selling system with a single buyer and multiple suppliers is considered to enhance profitability for both sides at the same time. An acceptable quantity discount condition for both the buyer and the suppliers to determine an appropriate order quantity allocation to produce more profits in the supply chain is proposed. Furthermore, the profit distribution between the buyer and each supplier is studied. Finally, the results of the numerical application show that the buyer should focus on managing the procurement costs to decrease the acquiring costs, and the suppliers should focus on the fixed costs of management to reduce the production costs in machine operations.
| Original language | English |
|---|---|
| Pages (from-to) | 6653-6671 |
| Number of pages | 19 |
| Journal | International Journal of Production Research |
| Volume | 53 |
| Issue number | 22 |
| DOIs | |
| Publication status | Published - 2015 Nov 17 |
Fingerprint
All Science Journal Classification (ASJC) codes
- Industrial and Manufacturing Engineering
- Management Science and Operations Research
- Strategy and Management
Cite this
}
Quantity discount coordination for allocation of purchase orders in supply chains with multiple suppliers. / Huang, Yeu-Shiang; Ho, Rong Shuan; Fang, Chih Chiang.
In: International Journal of Production Research, Vol. 53, No. 22, 17.11.2015, p. 6653-6671.Research output: Contribution to journal › Article
TY - JOUR
T1 - Quantity discount coordination for allocation of purchase orders in supply chains with multiple suppliers
AU - Huang, Yeu-Shiang
AU - Ho, Rong Shuan
AU - Fang, Chih Chiang
PY - 2015/11/17
Y1 - 2015/11/17
N2 - Studies about supply chain coordination have emphasised maximising the profit of the overall supply chain, but the profit changes of individual members in the supply chain have often been overlooked. It has been shown that profit increment of the whole supply chain may not be beneficial for every individual member. Therefore, the use of quantity discounts to achieve the coordination of a supply chain is discussed in this article. A two-echelon selling system with a single buyer and multiple suppliers is considered to enhance profitability for both sides at the same time. An acceptable quantity discount condition for both the buyer and the suppliers to determine an appropriate order quantity allocation to produce more profits in the supply chain is proposed. Furthermore, the profit distribution between the buyer and each supplier is studied. Finally, the results of the numerical application show that the buyer should focus on managing the procurement costs to decrease the acquiring costs, and the suppliers should focus on the fixed costs of management to reduce the production costs in machine operations.
AB - Studies about supply chain coordination have emphasised maximising the profit of the overall supply chain, but the profit changes of individual members in the supply chain have often been overlooked. It has been shown that profit increment of the whole supply chain may not be beneficial for every individual member. Therefore, the use of quantity discounts to achieve the coordination of a supply chain is discussed in this article. A two-echelon selling system with a single buyer and multiple suppliers is considered to enhance profitability for both sides at the same time. An acceptable quantity discount condition for both the buyer and the suppliers to determine an appropriate order quantity allocation to produce more profits in the supply chain is proposed. Furthermore, the profit distribution between the buyer and each supplier is studied. Finally, the results of the numerical application show that the buyer should focus on managing the procurement costs to decrease the acquiring costs, and the suppliers should focus on the fixed costs of management to reduce the production costs in machine operations.
UR - http://www.scopus.com/inward/record.url?scp=84947866885&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=84947866885&partnerID=8YFLogxK
U2 - 10.1080/00207543.2015.1055345
DO - 10.1080/00207543.2015.1055345
M3 - Article
VL - 53
SP - 6653
EP - 6671
JO - International Journal of Production Research
JF - International Journal of Production Research
SN - 0020-7543
IS - 22
ER -