Replenishment decisions under an all-units discount schedule and stepwise freight costs
Date
2009
Authors
Toptal, A.
Editor(s)
Advisor
Supervisor
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Instructor
Source Title
European Journal of Operational Research
Print ISSN
0377-2217
Electronic ISSN
1872-6860
Publisher
Elsevier
Volume
198
Issue
2
Pages
504 - 510
Language
English
Type
Journal Title
Journal ISSN
Volume Title
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Abstract
In this study, we analyze the replenishment decisions under a general replenishment cost structure that includes stepwise freight costs and all-units quantity discounts. We first formulate a general model that accounts for a larger class of problems and prove several useful properties of the expected profit function. We later utilize these properties to develop a computational solution approach to find the optimal order quantity. As an application of the general results, we study the replenishment decisions in the single-period, i.e., the Newsboy, problem considering several scenarios that model the cost considerations either for the buyer or for both the buyer and the vendor.