July  2005, 1(3): 275-287. doi: 10.3934/jimo.2005.1.275

Supply contract model with service level constraint

1. 

Academy of Mathematics and Systems Science, Chinese Academy of Sciences, Beijing 100080, China

2. 

Academy of Mathematics and Systems Science, Chinese Academy of Sciences, Beijing, 100190, China

3. 

Department of Intelligence and Informatics, Konan University, 8-9-1 Okamoto, Kobe 658-8501

Received  August 2004 Revised  March 2005 Published  July 2005

This paper addresses a new topic of supply chain management: service level constraint for a supply contract model in a buyer's perspective. The concept of order fill rate is introduced in the supply contract model as a measurement of customer service level. The buyer's optimal ordering decisions in both stages are derived by using the dynamic programming approach. The impact of the service level on the making of optimal decisions is analyzed. The main results include that: (1) the optimal ordering quantity with service level constraint is larger than or equal to that without constraint; (2) the optimal service level setting of the buyer is determined by the system parameters. The results presented in this paper provide insights for managers looking to find a tradeoff between profit maximization and customer service level.
Citation: Jun Wu, Shouyang Wang, Wuyi Yue. Supply contract model with service level constraint. Journal of Industrial & Management Optimization, 2005, 1 (3) : 275-287. doi: 10.3934/jimo.2005.1.275
[1]

Suresh P. Sethi, Houmin Yan, Hanqin Zhang, Jing Zhou. Information Updated Supply Chain with Service-Level Constraints. Journal of Industrial & Management Optimization, 2005, 1 (4) : 513-531. doi: 10.3934/jimo.2005.1.513

[2]

Honglin Yang, Jiawu Peng. Coordinating a supply chain with demand information updating. Journal of Industrial & Management Optimization, 2020  doi: 10.3934/jimo.2020181

[3]

Weihua Liu, Xinran Shen, Di Wang, Jingkun Wang. Order allocation model in logistics service supply chain with demand updating and inequity aversion: A perspective of two option contracts comparison. Journal of Industrial & Management Optimization, 2020  doi: 10.3934/jimo.2020118

[4]

Tsan-Ming Choi. Quick response in fashion supply chains with dual information updating. Journal of Industrial & Management Optimization, 2006, 2 (3) : 255-268. doi: 10.3934/jimo.2006.2.255

[5]

Sushil Kumar Dey, Bibhas C. Giri. Coordination of a sustainable reverse supply chain with revenue sharing contract. Journal of Industrial & Management Optimization, 2020  doi: 10.3934/jimo.2020165

[6]

Fei Cheng, Shanlin Yang, Ram Akella, Xiaoting Tang. An integrated approach for selection of service vendors in service supply chain. Journal of Industrial & Management Optimization, 2011, 7 (4) : 907-925. doi: 10.3934/jimo.2011.7.907

[7]

Juliang Zhang, Jian Chen. Information sharing in a make-to-stock supply chain. Journal of Industrial & Management Optimization, 2014, 10 (4) : 1169-1189. doi: 10.3934/jimo.2014.10.1169

[8]

Feimin Zhong, Wei Zeng, Zhongbao Zhou. Mechanism design in a supply chain with ambiguity in private information. Journal of Industrial & Management Optimization, 2020, 16 (1) : 261-287. doi: 10.3934/jimo.2018151

[9]

Joseph Geunes, Panos M. Pardalos. Introduction to the Special Issue on Supply Chain Optimization. Journal of Industrial & Management Optimization, 2007, 3 (1) : i-ii. doi: 10.3934/jimo.2007.3.1i

[10]

Mingyong Lai, Hongzhao Yang, Erbao Cao, Duo Qiu, Jing Qiu. Optimal decisions for a dual-channel supply chain under information asymmetry. Journal of Industrial & Management Optimization, 2018, 14 (3) : 1023-1040. doi: 10.3934/jimo.2017088

[11]

Qiang Lin, Ying Peng, Ying Hu. Supplier financing service decisions for a capital-constrained supply chain: Trade credit vs. combined credit financing. Journal of Industrial & Management Optimization, 2020, 16 (4) : 1731-1752. doi: 10.3934/jimo.2019026

[12]

Jing Shi, Tiaojun Xiao. Service investment and consumer returns policy in a vendor-managed inventory supply chain. Journal of Industrial & Management Optimization, 2015, 11 (2) : 439-459. doi: 10.3934/jimo.2015.11.439

[13]

Zonghong Cao, Jie Min. Selection and impact of decision mode of encroachment and retail service in a dual-channel supply chain. Journal of Industrial & Management Optimization, 2020  doi: 10.3934/jimo.2020167

[14]

Bin Dan, Huali Gao, Yang Zhang, Ru Liu, Songxuan Ma. Integrated order acceptance and scheduling decision making in product service supply chain with hard time windows constraints. Journal of Industrial & Management Optimization, 2018, 14 (1) : 165-182. doi: 10.3934/jimo.2017041

[15]

Jun Tu, Zijiao Sun, Min Huang. Supply chain coordination considering e-tailer's promotion effort and logistics provider's service effort. Journal of Industrial & Management Optimization, 2021  doi: 10.3934/jimo.2021062

[16]

Dingzhong Feng, Xiaofeng Zhang, Ye Zhang. Collection decisions and coordination in a closed-loop supply chain under recovery price and service competition. Journal of Industrial & Management Optimization, 2021  doi: 10.3934/jimo.2021117

[17]

Amin Aalaei, Hamid Davoudpour. Two bounds for integrating the virtual dynamic cellular manufacturing problem into supply chain management. Journal of Industrial & Management Optimization, 2016, 12 (3) : 907-930. doi: 10.3934/jimo.2016.12.907

[18]

Kai Li, Yuqian Pan, Bohai Liu, Bayi Cheng. The setting and optimization of quick queue with customer loss. Journal of Industrial & Management Optimization, 2020, 16 (3) : 1539-1553. doi: 10.3934/jimo.2019016

[19]

Nina Yan, Tingting Tong, Hongyan Dai. Capital-constrained supply chain with multiple decision attributes: Decision optimization and coordination analysis. Journal of Industrial & Management Optimization, 2019, 15 (4) : 1831-1856. doi: 10.3934/jimo.2018125

[20]

Qiong Liu, Ahmad Reza Rezaei, Kuan Yew Wong, Mohammad Mahdi Azami. Integrated modeling and optimization of material flow and financial flow of supply chain network considering financial ratios. Numerical Algebra, Control & Optimization, 2019, 9 (2) : 113-132. doi: 10.3934/naco.2019009

2020 Impact Factor: 1.801

Metrics

  • PDF downloads (50)
  • HTML views (0)
  • Cited by (1)

Other articles
by authors

[Back to Top]