Inventory Model and Pricing in the Supply Chain Approach VMI Considering Incremental Discount

Document Type : Original Article

Authors

Industrial Engineering Group، Abhar Branch، Islamic Azad University، Abhar، Iran

Abstract

Given the globalization of competition and the existence of many rivals, the optimization supply chain has been highly regarded. One of the key issues in optimizing supply chain is to increase profitability and cost reduction. Since inventories have a large part of the cost of supply chain, the determination of the optimal level of inventory can have an effective role in cost reductions. In addition to costs reduction, attracting a larger share of the demand market can increase profitability. One of the effective factors in attracting customers is market price. On the other hand, discounts on the supply chain will encourage more buy and, of course, buy will further increase the costs. Therefore, this article addresses the issues of simultaneous pricing and inventory control in a supply chain bi-level, and optimal buy policy the mode of existence of incremental discounts and optimal pricing policies has been determined. In this regard, the mathematical model and numerical examples have been solved.

Keywords


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