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Non-cooperative consignment stock strategies for management in supply chain

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  • Bylka, Stanisław

Abstract

This paper analyzes the coordination and competition issue in a two-level supply chain, having one vendor (or manufacturer) and one buyer (or retailer). A continuous deterministic model is presented. To satisfy the buyer's demands, the product is delivered in discrete batches from the vendor's stock to the buyer's stock and all shipments are realized instantaneously. We describe inventory patterns and the cost structure of production–distribution cycles (PDC) under generalized consignment stock (CS) policies. For the joint optimization case, the average total cost of production, shipment and stockholding is minimized. Optimal solution techniques are presented and illustrated with numerical examples.

Suggested Citation

  • Bylka, Stanisław, 2013. "Non-cooperative consignment stock strategies for management in supply chain," International Journal of Production Economics, Elsevier, vol. 143(2), pages 424-433.
    • Handle: RePEc:eee:proeco:v:143:y:2013:i:2:p:424-433
    DOI: 10.1016/j.ijpe.2011.07.018
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    References listed on IDEAS

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    1. Lu, Lu, 1995. "A one-vendor multi-buyer integrated inventory model," European Journal of Operational Research, Elsevier, vol. 81(2), pages 312-323, March.
    2. Bylka, Stanislaw, 2009. "Non-cooperative strategies for production and shipments lot sizing in the vendor-buyer system," International Journal of Production Economics, Elsevier, vol. 118(1), pages 243-252, March.
    3. Chen, Jen-Ming & Lin, I-Chen & Cheng, Hung-Liang, 2010. "Channel coordination under consignment and vendor-managed inventory in a distribution system," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(6), pages 831-843, November.
    4. Gümüs, Mehmet & Jewkes, Elizabeth M. & Bookbinder, James H., 2008. "Impact of consignment inventory and vendor-managed inventory for a two-party supply chain," International Journal of Production Economics, Elsevier, vol. 113(2), pages 502-517, June.
    5. Ru, Jun & Wang, Yunzeng, 2010. "Consignment contracting: Who should control inventory in the supply chain?," European Journal of Operational Research, Elsevier, vol. 201(3), pages 760-769, March.
    6. Sarmah, S.P. & Acharya, D. & Goyal, S.K., 2006. "Buyer vendor coordination models in supply chain management," European Journal of Operational Research, Elsevier, vol. 175(1), pages 1-15, November.
    7. Zavanella, Lucio & Zanoni, Simone, 2009. "A one-vendor multi-buyer integrated production-inventory model: The 'Consignment Stock' case," International Journal of Production Economics, Elsevier, vol. 118(1), pages 225-232, March.
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    Cited by:

    1. Ik Sun Lee, 2016. "Production and shipment policy under dynamic demand in the supply chain environments," International Journal of Applied Management Science, Inderscience Enterprises Ltd, vol. 8(1), pages 1-19.
    2. Ágota Bányai & Tamás Bányai & Béla Illés, 2017. "Optimization of Consignment-Store-Based Supply Chain with Black Hole Algorithm," Complexity, Hindawi, vol. 2017, pages 1-12, September.
    3. B. C. Giri & A. Chakraborty & T. Maiti, 2017. "Effectiveness of consignment stock policy in a three-level supply chain," Operational Research, Springer, vol. 17(1), pages 39-66, April.
    4. Günter Fandel & Jan Trockel, 2016. "Investment and lot size planning in a supply chain: coordinating a just-in-time-delivery with a Harris- or a Wagner/Whitin-solution," Journal of Business Economics, Springer, vol. 86(1), pages 173-195, January.

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