Coordination Mechanism of Economic Lot and Delivery Scheduling Problem

Abstract

Abstract: Economic lot and delivery scheduling problem (ELDSP) is a typical research topic in the field of supply chain. Up to now, most research results obtained on this topic are based on centralized decision making. However, because of the autonomous nature of supply chain, it may not be always applicable. Thus, the ELDSP is studied by using decentralized decision making in this paper. A mathematical model is developed for this problem. Based on the model, it shows that an optimal solution cannot be obtained without coordination. Thus, the profit and cost sharing contract (PCS) is adopted for coordination. With PCS, the profit of the supply chain can be flexibly distributed between the vendor and buyer. In this way, an optimal solution for the ELDSP can be found if the profit and cost sharing contract is properly designed.

Key words: economic lot and delivery scheduling (ELDS), coordination mechanism, decentralized decision, supply chain

Li Zhengdao1，2, Zhou Hong1. Coordination Mechanism of Economic Lot and Delivery Scheduling Problem[J]. Industrial Engineering Journal , 2012, 15(1): 18-22.

References

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