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Coordinating replenishment decisions in a two-stage supply chain by considering truckload limitation based on delay in payments

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  • Jafar Heydari

Abstract

Improper setting of replenishment decisions can lead to lower service level and therefore reduces the whole supply chain (SC) profitability. In a decentralised SC, each member has the full authority of setting its own replenishment decisions, while these decisions affect the other SC members. In this paper, a single-upstream and single-downstream SC is considered, in which the upstream by proposing an incentive scheme based on delay in payments convinces the buyer to globally optimise his/her reorder point and also order quantity. Demand and also lead times are assumed uncertain in the investigated model. In addition, a truckload limitation is considered in downstream side. The proposed model ensures the global optimum of replenishment decisions under some circumstances. The model has the ability of sharing benefits between members to guarantee their participation. Maximum and minimum acceptable delay-in-payments durations are extracted. The results of numerical experiments show that the model has the ability of coordinating SC in most of the realistic parameter sets. Condition under which the proposed model is not able to coordinate the SC is also reported using a sensitivity analysis on the primary parameters. Extensive numerical experiments show capabilities of the proposed model in coordinating SC.

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  • Jafar Heydari, 2015. "Coordinating replenishment decisions in a two-stage supply chain by considering truckload limitation based on delay in payments," International Journal of Systems Science, Taylor & Francis Journals, vol. 46(10), pages 1897-1908, July.
    • Handle: RePEc:taf:tsysxx:v:46:y:2015:i:10:p:1897-1908
    DOI: 10.1080/00207721.2013.843216
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    Cited by:

    1. Mohammad Reza Gholamian & Mahdi Ebrahimzadeh-Afruzi, 2021. "Credit and discount incentive options for two-level supply chain coordination, under uncertain price-dependent demand," Operational Research, Springer, vol. 21(4), pages 2283-2307, December.
    2. Hong Cheng & Yingsheng Su & Jinjiang Yan & Xianyu Wang & Mingyang Li, 2019. "The Incentive Model in Supply Chain with Trade Credit and Default Risk," Complexity, Hindawi, vol. 2019, pages 1-11, May.
    3. Hosseini-Motlagh, Seyyed-Mahdi & Nematollahi, Mohammadreza & Johari, Maryam & Sarker, Bhaba R., 2018. "A collaborative model for coordination of monopolistic manufacturer's promotional efforts and competing duopolistic retailers' trade credits," International Journal of Production Economics, Elsevier, vol. 204(C), pages 108-122.
    4. Heydari, Jafar & Govindan, Kannan & Ebrahimi Nasab, Hamid Reza & Taleizadeh, Ata Allah, 2020. "Coordination by quantity flexibility contract in a two-echelon supply chain system: Effect of outsourcing decisions," International Journal of Production Economics, Elsevier, vol. 225(C).
    5. Viktoryia Buhayenko & Sin C. Ho & Anders Thorstenson, 2018. "A variable neighborhood search heuristic for supply chain coordination using dynamic price discounts," EURO Journal on Transportation and Logistics, Springer;EURO - The Association of European Operational Research Societies, vol. 7(4), pages 363-385, December.
    6. Li, Jin & Yang, Shilei & Shi, Victor & Zhai, Senjing, 2020. "Partial vertical centralization in competing supply chains," International Journal of Production Economics, Elsevier, vol. 224(C).
    7. Chan, Chi Kin & Fang, Fei & Langevin, André, 2018. "Single-vendor multi-buyer supply chain coordination with stochastic demand," International Journal of Production Economics, Elsevier, vol. 206(C), pages 110-133.
    8. Mu, Xiuqing & Kang, Kai & Zhang, Jing, 2022. "Dual-channel supply chain coordination considering credit sales competition," Applied Mathematics and Computation, Elsevier, vol. 434(C).
    9. Mina Nouri & Seyyed-Mahdi Hosseini-Motlagh & Mohammadreza Nematollahi, 2021. "Proposing a discount policy for two-level supply chain coordination with periodic review replenishment and promotional efforts decisions," Operational Research, Springer, vol. 21(1), pages 365-398, March.

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