Supplier Selection in Three Echelon Supply Chain Vendor Managed Inventory Model Under Price Dependent Demand Condition

This study examines the supplier selection in three echelon supply chain and Vendor Managed Inventory (VMI) strategy underprice dependent demand condition. It seems that the study of supplier selection has been underexplored following the literature on, this paper presents a VMI model in supply chain including multi-supplier, one distributer and multi-retailer that distributer selects suppliers. Two class models (traditional vs. VMI) are presented and compared to study the impact of VMI on supply chain and supplier selection. As the proposed model is an NP-hard problem, a meta-heuristic, namely Harmony Search, is employed to optimize the proposed models. We show that how the VMI system affects supplier selection and can change the set of selected suppliers. The implications and suggestions for further research are given.