An integrated acquisition policy for supplier selection and lot sizing considering total quantity discounts and a quality constraint

Xin Li; José A. Ventura; Bárbara B. Venegas; Sang Jin Kweon; Seong Wook Hwang

doi:10.1016/j.tre.2018.09.003

An integrated acquisition policy for supplier selection and lot sizing considering total quantity discounts and a quality constraint

Xin Li, José A. Ventura, Bárbara B. Venegas, Sang Jin Kweon, Seong Wook Hwang

Marcus Department of Industrial and Manufacturing Engineering

Research output: Contribution to journal › Article › peer-review

20 Scopus citations

Abstract

We consider a two-stage supply chain where a buyer purchases a product from multiple capacitated suppliers to satisfy a constant demand rate over a finite planning horizon. Suppliers have different perfect rates and offer total quantity discounts. The buyer selects suppliers and allocates orders to them that satisfy a minimum average quality level. A mathematical model is proposed with the objective on minimizing the total cost per time unit. The model is solved by dualizing the quality constraint. The relaxed model is solved by an efficient dynamic programming algorithm. The subgradient method is used to solve the dual problem.

Original language	English (US)
Pages (from-to)	19-40
Number of pages	22
Journal	Transportation Research Part E: Logistics and Transportation Review
Volume	119
DOIs	https://doi.org/10.1016/j.tre.2018.09.003
State	Published - Nov 2018

All Science Journal Classification (ASJC) codes

Business and International Management
Civil and Structural Engineering
Transportation

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10.1016/j.tre.2018.09.003

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abstract = "We consider a two-stage supply chain where a buyer purchases a product from multiple capacitated suppliers to satisfy a constant demand rate over a finite planning horizon. Suppliers have different perfect rates and offer total quantity discounts. The buyer selects suppliers and allocates orders to them that satisfy a minimum average quality level. A mathematical model is proposed with the objective on minimizing the total cost per time unit. The model is solved by dualizing the quality constraint. The relaxed model is solved by an efficient dynamic programming algorithm. The subgradient method is used to solve the dual problem.",

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AU - Kweon, Sang Jin

AU - Hwang, Seong Wook

PY - 2018/11

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AB - We consider a two-stage supply chain where a buyer purchases a product from multiple capacitated suppliers to satisfy a constant demand rate over a finite planning horizon. Suppliers have different perfect rates and offer total quantity discounts. The buyer selects suppliers and allocates orders to them that satisfy a minimum average quality level. A mathematical model is proposed with the objective on minimizing the total cost per time unit. The model is solved by dualizing the quality constraint. The relaxed model is solved by an efficient dynamic programming algorithm. The subgradient method is used to solve the dual problem.

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ER -

An integrated acquisition policy for supplier selection and lot sizing considering total quantity discounts and a quality constraint

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