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Author: Frank Chen Publisher: ISBN: Category : Languages : en Pages : 20
Book Description
This paper studies a periodic-review pricing and inventory control problem for a retailer, which faces stochastic price-sensitive demand, under quite general modeling assumptions. Any unsatisfied demand is lost, and any leftover inventory at the end of the finite selling horizon has a salvage value. The cost component for the retailer includes holding, shortage, and both variable and fixed ordering costs. The retailer's objective is to maximize its discounted expected profit over the selling horizon by dynamically deciding on the optimal pricing and replenishment policy for each period. We show that, under a mild assumption on the additive demand function, at the beginning of each period an (s, S) policy is optimal for replenishment, and the value of the optimal price depends on the inventory level after the replenishment decision has been done. Our numerical study also suggests that for a sufficiently long selling horizon, the optimal policy is almost stationary. Furthermore, the fixed ordering cost (K) plays a significant role in our modeling framework. Specifically, any increase in K results in lower s and higher S. On the other hand, the profit impact of dynamically changing the retail price, contrasted with a single fixed price throughout the selling horizon, also increases with K. We demonstrate that using the optimal policy values from a model with backordering of unmet demands as approximations in our model might result in significant profit penalty.
Author: Frank Chen Publisher: ISBN: Category : Languages : en Pages : 20
Book Description
This paper studies a periodic-review pricing and inventory control problem for a retailer, which faces stochastic price-sensitive demand, under quite general modeling assumptions. Any unsatisfied demand is lost, and any leftover inventory at the end of the finite selling horizon has a salvage value. The cost component for the retailer includes holding, shortage, and both variable and fixed ordering costs. The retailer's objective is to maximize its discounted expected profit over the selling horizon by dynamically deciding on the optimal pricing and replenishment policy for each period. We show that, under a mild assumption on the additive demand function, at the beginning of each period an (s, S) policy is optimal for replenishment, and the value of the optimal price depends on the inventory level after the replenishment decision has been done. Our numerical study also suggests that for a sufficiently long selling horizon, the optimal policy is almost stationary. Furthermore, the fixed ordering cost (K) plays a significant role in our modeling framework. Specifically, any increase in K results in lower s and higher S. On the other hand, the profit impact of dynamically changing the retail price, contrasted with a single fixed price throughout the selling horizon, also increases with K. We demonstrate that using the optimal policy values from a model with backordering of unmet demands as approximations in our model might result in significant profit penalty.
Author: Youhua Chen Publisher: ISBN: Category : Languages : en Pages :
Book Description
We consider a setting in which inventory plays both promotional and service roles; that is, higher inventories not only improve service levels but also stimulate demand by serving as a promotional tool (e.g., as the result of advertising effect by the enhanced product visibility). Specifically, we study the periodic-review inventory systems in which the demand in each period is uncertain but increases with the inventory level. We investigate the multiperiod model with normal and expediting orders in each period, that is, any shortage will be met through emergency replenishment. Such a model takes the lost sales model as a special case. For the cases without and with fixed order costs, the optimal inventory replenishment policy is shown to be of the base-stock type and of the (s, S) type, respectively.
Author: Özalp Özer Publisher: Oxford University Press (UK) ISBN: 0199543178 Category : Business & Economics Languages : en Pages : 977
Book Description
A definitive reference to the theory and practice of pricing across industries, environments, and methodologies. It covers all major areas of pricing including, pricing fundamentals, pricing tactics, and pricing management.
Author: Jing-Sheng J. Song Publisher: Edward Elgar Publishing ISBN: 180037710X Category : Technology & Engineering Languages : en Pages : 565
Book Description
This comprehensive Handbook provides an overview of state-of-the-art research on quantitative models for inventory management. Despite over half a century’s progress, inventory management remains a challenge, as evidenced by the recent Covid-19 pandemic. With an expanse of world-renowned inventory scholars from major international research universities, this Handbook explores key areas including mathematical modelling, the interplay of inventory decisions and other business decisions and the unique challenges posed to multiple industries.
Author: Boxiao Chen Publisher: ISBN: Category : Languages : en Pages : 42
Book Description
We consider the periodic review dynamic pricing and inventory control problem with fixed ordering cost. Demand is random and price dependent, and unsatisfied demand is backlogged. With complete demand information, the celebrated (s,S,p) policy is proved to be optimal, where s and S are the reorder point and order-up-to level for ordering strategy, and p, a function of on-hand inventory level, characterizes the pricing strategy. In this paper, we consider incomplete demand information and develop online learning algorithms whose average profit approaches that of the optimal (s,S,p) with a tight O ̃(√T) regret rate. A number of salient features differentiate our work from the existing online learning researches in the OM literature. First, computing the optimal (s,S,p) policy requires solving a dynamic programming (DP) over multiple periods involving unknown quantities, which is different from the majority of learning problems in operations management that only require solving single-period optimization questions. It is hence challenging to establish stability results through DP recursions, which we accomplish by proving uniform convergence of the profit-to-go function. The necessity of analyzing action-dependent state transition over multiple periods resembles the reinforcement learning question, considerably more difficult than existing bandit learning algorithms. Second, the pricing function p is of infinite dimension, and approaching it is much more challenging than approaching a finite number of parameters as seen in existing researches. The demand-price relationship is estimated based on upper confidence bound, but the confidence interval cannot be explicitly calculated due to the complexity of the DP recursion. Finally, due to the multi-period nature of (s,S,p) policies the actual distribution of the randomness in demand plays an important role in determining the optimal pricing strategy p, which is unknown to the learner a priori. In this paper, the demand randomness is approximated by an empirical distribution constructed using dependent samples, and a novel Wasserstein metric based argument is employed to prove convergence of the empirical distribution.
Author: Diptesh Ghosh Publisher: Springer Nature ISBN: 981165820X Category : Business & Economics Languages : en Pages : 224
Book Description
This edited volume is an in-depth collation of the usage of different quantitative decision making techniques in practical areas such as lean & green supply chain, reverse logistics, perishable logistics, closed loop supply chain, sustainable project management, retail management, block chain applications, optimal supplier selection problem, demand/supply modelling, forecasting under uncertainties, scheduling & sequencing, resource constraint logistics, dynamic network supply chain, risk evaluation, and so on. Additionally, the book also solves these issues in theoretical and practical context using innovative mathematical tools. Consisting of selected papers from the 23rd Annual International Conference of the Society of Operations Management, this book's highlight is not only the coverage of interesting topics, but also how these topics are dealt with, such that post-graduate students as well as researchers and industry personnel working in areas like engineering, economics, social sciences, management, mathematics, etc., can derive the maximum benefit by reading or referring to this book. Apart from the emphasis on new mathematical, operations research, operations management, and statistical techniques, the authors also ensure that all the concepts are made clear by highlighting their practical significance in different areas of applications of operations management. By using novel presentation methods, the book offers a good practical flavor of all the different topics relevant to operations management in the coming decades.
Author: B.S. Sahaye Publisher: Allied Publishers ISBN: Category : Business & Economics Languages : en Pages : 686
Book Description
It is not uncommon to find books and other publications in the literature dealing individually with the subjects of 'decision sciences', 'technology' and ' globalisation' However, there are very few instances of books which integrate these three dimensions in an umbrella framework. This publication is one such attempt. This book comprises of 58 papers contributed by leading academia from universities and management institutes in India and abroad. Many of the contributions have come from USA, Canada, UK, Japan, Australia, New Zealand, UAE, Bahrain, Taiwan, Brazil and Mexico, adding to the rich diversity of the thought processes explored in the papers. Some of these papers are country-specific, while some others provide a transnational perspective. Also, while some papers provide enriched conceptual frameworks in specific disciplines, building upon existing frameworks, several other papers provide application-oriented coverage, focused at select organizations or industries, further adding unique value to this book. There are eight sections in the book, namely: Supply Chain Management Operations Management Information Systems & ICT IT & E-Business Strategies Business Modeling Global Business: Issues & Challenges Marketing and Globalisation New Paradigms in Education and Globalisation The issues touched upon by various papers within each section are diverse and yet highly relevant and contemporary. We believe this book would be useful not only to academia, research scholars and students of various disciplines of management, but also to those in the industry in India and abroad, who are seeking conceptual inputs and experience sharing in their respective positions.
Author: Thomas Wensing Publisher: Springer Science & Business Media ISBN: 3642204791 Category : Business & Economics Languages : en Pages : 159
Book Description
The focus of the work is twofold. First, it provides an introduction into fundamental structural and behavioral aspects of periodic review inventory systems. Second, it includes a comprehensive study on analytical and optimization aspects of a specific class of those systems. For the latter purpose, general solution methods for problems of inventory management in discrete time are described and developed along with highly specialized methods to solve very specific problems related to the model variants examined. The work is thus addressed to students and practitioners who seek a deeper understanding of managing inventories in discrete time as well as to software developers who require implementation aids on specific problems of inventory management.
Author: Frank Chen
Author: Frank Chen
Author: Youhua Chen
Author: Özalp Özer
Author: Guangyu Xiong
Author: Jing-Sheng J. Song
Author: Boxiao Chen
Author: Diptesh Ghosh
Author: B.S. Sahaye
Author: 
Author: Thomas Wensing