Pricing, inventory and production policies in a supply chain of pharmacological products with rework process: a game theoretic approach

In this paper, an economic production quantity model in a three levels supply chain including multiple non-competing suppliers, single manufacturer and multiple non-competing retailers for multiple products with rework process under integrated and non-integrated structures is developed. In this chai...

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Bibliographic Details
Published in:Operational research 2016-04, Vol.16 (1), p.89-115
Main Authors: Taleizadeh, Ata Allah, Noori-daryan, Mahsa
Format: Article
Language:English
Subjects:
Algorithms
Business and Management
Chains
Computational Intelligence
Credit policy
Defective products
Game theory
Inventory
Inventory control
Management Science
Manufacturers
Manufacturing
Mathematical models
Operations Research
Operations Research/Decision Theory
Order quantity
Original Paper
Policies
Pricing
Random variables
Raw materials
Retail stores
Stockpiling
Suppliers
Supply chains
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Summary:In this paper, an economic production quantity model in a three levels supply chain including multiple non-competing suppliers, single manufacturer and multiple non-competing retailers for multiple products with rework process under integrated and non-integrated structures is developed. In this chain, suppliers ship raw material to the manufacturer and the manufacturer combines the fixed percentage of different kinds of raw material to produce the finished products and then delivers them to the retailers. The Stackelberg game is established among the members of the chain. Optimizing the total profit of the chain under both structures applying the optimal pricing, inventory and production policies is the purpose of the research. Eventually, a numerical example is presented for comparing the total profit of the integrated and non-integrated chains of proposed model and some sensitivity analyses are performed to study the effects of parameter changes on the decision variables and the chain profit.
ISSN:1109-2858
1866-1505
DOI:10.1007/s12351-015-0188-7