Retailer's optimal order and credit policies when a supplier offers either a cash discount or a delay payment linked to order quantity
CT Yang, Q Pan, LY Ouyang… - European Journal of …, 2013 - inderscienceonline.com
European Journal of Industrial Engineering, 2013•inderscienceonline.com
To increase sales and reduce default risks, a supplier may offer its retailers either: 1 a cash
discount 2 a fixed credit period M if the order quantity is greater than or equal to a
predetermined quantity W. Likewise, a retailer in turn offers its customers a credit period N,
which has a positive impact on its demand but a negative impact on its default risks. In this
paper, we establish an inventory model for a retailer in a supply chain when a supplier offers
either a cash discount or a delay payment linked to order quantity; meanwhile it offers its …
discount 2 a fixed credit period M if the order quantity is greater than or equal to a
predetermined quantity W. Likewise, a retailer in turn offers its customers a credit period N,
which has a positive impact on its demand but a negative impact on its default risks. In this
paper, we establish an inventory model for a retailer in a supply chain when a supplier offers
either a cash discount or a delay payment linked to order quantity; meanwhile it offers its …
To increase sales and reduce default risks, a supplier may offer its retailers either:
- 1a cash discount
- 2a fixed credit period M if the order quantity is greater than or equal to a predetermined quantity W.
Likewise, a retailer in turn offers its customers a credit period N, which has a positive impact on its demand but a negative impact on its default risks. In this paper, we establish an inventory model for a retailer in a supply chain when a supplier offers either a cash discount or a delay payment linked to order quantity; meanwhile it offers its customers a permissible delay in payments. Then, we derive several theoretical results to determine the optimal solution under various situations and develop an algorithm to solve this complex inventory problem. Finally, several numerical examples are given to illustrate the theoretical results and provide some managerial insights.
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