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Retailer’s inventory policies for a one time only manufacturer trade deal of uncertain duration

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Abstract

This paper models a retailer’s response to temporary manufacturer’s trade deals characterized by a time interval of random length, but with the ending date known before its occurrence. Uncertainty is handled through a reordering point, which serves as a trigger mechanism for a new special order and is activated at the discount termination date. The model generates ordering policies, applicable to any probability distribution and is shown to yield well-known deterministic optimal policies as a limiting case.

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Authors and Affiliations

  1. Departanemto de Gestión de Empresas, Universidad Pública de Navarra, Campus de Arrosadía, Pamplona, Navarra, 31006, Spain

    Francisco Arcelus, T. P. M. Pakkala & Gopalan Srinivasan

Authors
  1. Francisco Arcelus
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  2. T. P. M. Pakkala
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  3. Gopalan Srinivasan
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Correspondence to Francisco Arcelus.

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Arcelus, F., Pakkala, T.P.M. & Srinivasan, G. Retailer’s inventory policies for a one time only manufacturer trade deal of uncertain duration. Ann Oper Res 164, 3–15 (2008). https://doi.org/10.1007/s10479-007-0256-3

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  • DOI: https://doi.org/10.1007/s10479-007-0256-3

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