The newsvendor pricing problem with supplier discounts

Author

Zhang, Guoqing ; Shi, Jianmai

Author_Institution

Dept. of Ind. & Manuf. Syst. Eng., Univ. of Windsor, Windsor, ON, Canada

fYear

2010

fDate

28-30 June 2010

Firstpage

1

Lastpage

4

Abstract

We consider the constrained newsvendor pricing problem where the suppliers provide all unit quantity discounts. The problem is to determine the optimal acquisition quantities and selling prices so as to maximize the retailer´s expected profit, subject to a budget constraint. We present a mixed integer nonlinear programming (MINLP) model to formulate the problem, and develop a Lagrangian based solution approach. A numerical example is presented to verify the approach.

Keywords

integer programming; nonlinear programming; pricing; retailing; Lagrangian based solution; budget constraint; constrained newsvendor pricing problem; mixed integer nonlinear programming; optimal acquisition quantities; selling prices; supplier discounts; Defense industry; Engineering management; Information management; Lagrangian functions; Management information systems; Manufacturing industries; Manufacturing systems; Pricing; Systems engineering and theory; Technology management; Newsvendor; acquisition; discount; pricing; uncertain demand;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2010 7th International Conference on

Conference_Location

Tokyo

Print_ISBN

978-1-4244-6485-2

Type

conf

DOI

10.1109/ICSSSM.2010.5530140

Filename

5530140