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Type: Journal article
Title: Coordination of supply chains with a flexible ordering policy under yield and demand uncertainty
Author: Hu, F.
Lim, C.
Lu, Z.
Citation: International Journal of Production Economics, 2013; 146(2):686-693
Publisher: Elsevier Science BV
Issue Date: 2013
ISSN: 0925-5273
Statement of
Fei Hu, Cheng-Chew Lim, Zudi Lu
Abstract: This paper studies a flexible ordering policy among a manufacturer and a supplier with random yield and demand uncertainty, where the order quantity lies between the minimum and the maximum quantity. We first determine the optimal flexible ordering policy and the corresponding raw material production quantity that maximize expected profit of the centralized supply chain, and find that our flexible ordering policy can significantly enhance the supply chain's expected profit compared to an invariable ordering policy. Then we analyze the decentralized scenario and propose a revenue sharing policy with an order penalty and rebate (OPR) contract to fully coordinate the supply chain. Finally, numerical examples are given to illustrate the results. © 2013 Elsevier B.V.
Keywords: Supply chain coordination
Flexible ordering policy
Combined contract
Rights: Copyright © 2013 Elsevier B.V. All rights reserved.
DOI: 10.1016/j.ijpe.2013.08.024
Appears in Collections:Aurora harvest 4
Electrical and Electronic Engineering publications

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