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A serial inventory system with supplier selection and order quantity allocation

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  • Mendoza, Abraham
  • Ventura, José A.

Abstract

Given the prevalence of both supplier selection and inventory control problems in supply chain management, this article addresses these problems simultaneously by developing a mathematical model for a serial system. This model determines an optimal inventory policy that coordinates the transfer of items between consecutive stages of the system while properly allocating orders to selected suppliers in stage 1. In addition, a lower bound on the minimum total cost per time unit is obtained and a 98% effective power-of-two (POT) inventory policy is derived for the system under consideration. This POT algorithm is advantageous since it is simple to compute and yields near optimal solutions.

Suggested Citation

  • Mendoza, Abraham & Ventura, José A., 2010. "A serial inventory system with supplier selection and order quantity allocation," European Journal of Operational Research, Elsevier, vol. 207(3), pages 1304-1315, December.
    • Handle: RePEc:eee:ejores:v:207:y:2010:i:3:p:1304-1315
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    Cited by:

    1. Ventura, José A. & Bunn, Kevin A. & Venegas, Bárbara B. & Duan, Lisha, 2021. "A coordination mechanism for supplier selection and order quantity allocation with price-sensitive demand and finite production rates," International Journal of Production Economics, Elsevier, vol. 233(C).
    2. Pun, Hubert, 2014. "Supplier selection of a critical component when the production process can be improved," International Journal of Production Economics, Elsevier, vol. 154(C), pages 127-135.
    3. José A. Ventura & Boaz Golany & Abraham Mendoza & Chenxi Li, 2022. "A multi-product dynamic supply chain inventory model with supplier selection, joint replenishment, and transportation cost," Annals of Operations Research, Springer, vol. 316(2), pages 729-762, September.
    4. Svoboda, Josef & Minner, Stefan & Yao, Man, 2021. "Typology and literature review on multiple supplier inventory control models," European Journal of Operational Research, Elsevier, vol. 293(1), pages 1-23.
    5. Ventura, José A. & Valdebenito, Victor A. & Golany, Boaz, 2013. "A dynamic inventory model with supplier selection in a serial supply chain structure," European Journal of Operational Research, Elsevier, vol. 230(2), pages 258-271.
    6. Yu, Yugang & Hong, Zhaofu & Zhang, Linda L. & Liang, Liang & Chu, Chengbin, 2013. "Optimal selection of retailers for a manufacturing vendor in a vendor managed inventory system," European Journal of Operational Research, Elsevier, vol. 225(2), pages 273-284.
    7. Li, Xin & Ventura, José A. & Venegas, Bárbara B. & Kweon, Sang Jin & Hwang, Seong Wook, 2018. "An integrated acquisition policy for supplier selection and lot sizing considering total quantity discounts and a quality constraint," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 119(C), pages 19-40.
    8. Sayan Chakraborty & Akshat Jain & S. P. Sarmah, 2022. "An integrated mathematical model based on grey optimal ranking for supplier selection considering pandemic situation," OPSEARCH, Springer;Operational Research Society of India, vol. 59(4), pages 1613-1648, December.
    9. Firouz, Mohammad & Keskin, Burcu B. & Melouk, Sharif H., 2017. "An integrated supplier selection and inventory problem with multi-sourcing and lateral transshipments," Omega, Elsevier, vol. 70(C), pages 77-93.
    10. Adeinat, Hamza & Pazhani, Subramanian & Mendoza, Abraham & Ventura, Jose A., 2022. "Coordination of pricing and inventory replenishment decisions in a supply chain with multiple geographically dispersed retailers," International Journal of Production Economics, Elsevier, vol. 248(C).
    11. Sobhani, A. & Wahab, M.I.M. & Jaber, M.Y., 2019. "The effect of working environment aspects on a vendor–buyer inventory model," International Journal of Production Economics, Elsevier, vol. 208(C), pages 171-183.
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    13. Duan, Lisha & Ventura, José A., 2019. "A Dynamic Supplier Selection and Inventory Management Model for a Serial Supply Chain with a Novel Supplier Price Break Scheme and Flexible Time Periods," European Journal of Operational Research, Elsevier, vol. 272(3), pages 979-998.

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