Optimal outbound dispatching policy with pricing

Ki Sung Hong, Chulung Lee

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

Under a VMI(Vendor Managed Inventory) system, the vendor holds a certain level of control over not only inbound replenishment decisions on stocking but also outbound re-supply decisions. Hence, vendor faces a better opportunity to synchronize the inventory and transportation decision. While shipment consolidation can reduce the transportation cost, however, delivery time to the customer may increase. Thus, inventory and transportation decision must be coordinated considering both customer service requirement and transportation cost. In this study, we have developed a optimal outbound dispatch policy to maximize profits under a quantity based dispatching policy. A mathematical model is developed and an efficient algorithm is provided to obtain the optimal parameters for the proposed policy.

Original languageEnglish
Title of host publication2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008
Pages1630-1633
Number of pages4
DOIs
Publication statusPublished - 2008
Event2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008 - Singapore, Singapore
Duration: 2008 Dec 82008 Dec 11

Publication series

Name2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008

Other

Other2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008
CountrySingapore
CitySingapore
Period08/12/808/12/11

Keywords

  • Linear demand function
  • Pricing
  • Shipment consolidation

ASJC Scopus subject areas

  • Management Information Systems
  • Industrial and Manufacturing Engineering

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  • Cite this

    Hong, K. S., & Lee, C. (2008). Optimal outbound dispatching policy with pricing. In 2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008 (pp. 1630-1633). [4738148] (2008 IEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2008). https://doi.org/10.1109/IEEM.2008.4738148