Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework
In this study, we developed a trade credit policy for a three-layer supply chain consisting of a supplier, a manufacturer and a retailer. We propose an optimal production rate and selling price for the manufacturer and the retailer under an imperfect production system. The suggested coordination po...
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| Format: | Article |
| Language: | English |
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ITB Journal Publisher
2022-06-01
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| Series: | Journal of Mathematical and Fundamental Sciences |
| Subjects: | |
| Online Access: | https://journals.itb.ac.id/index.php/jmfs/article/view/11052 |
| _version_ | 1818231997297852416 |
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| author | Atmaram Nigwal Uttam Kumar Khedlekar Leena Sharma Neelesh Gupta |
| author_facet | Atmaram Nigwal Uttam Kumar Khedlekar Leena Sharma Neelesh Gupta |
| author_sort | Atmaram Nigwal |
| collection | DOAJ |
| description |
In this study, we developed a trade credit policy for a three-layer supply chain consisting of a supplier, a manufacturer and a retailer. We propose an optimal production rate and selling price for the manufacturer and the retailer under an imperfect production system. The suggested coordination policy optimizes the profit of each supply chain member. Two models were formulated for two real-life strategies respectively. The first one is a collaborative (integrated) system and the second one is a Stackelberg leadership system. Both strategies were analyzed for various credit periods, respectively offered by the supplier to the manufacturer, by the manufacturer to the retailer, and by the retailer to the customers, by considering price-sensitive demand and a certain replenishment rate. Finally, we concluded which strategy will be better for inventory management under the given restrictions in the form of propositions. The concavity property for the net profit function was established with respect to the selling price and the production rate, which was also described graphically and analyzed by numerical examples.
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| first_indexed | 2024-12-12T10:59:17Z |
| format | Article |
| id | doaj.art-41a3437da4d44914aea2abc736c7d4dc |
| institution | Directory Open Access Journal |
| issn | 2337-5760 2338-5510 |
| language | English |
| last_indexed | 2024-12-12T10:59:17Z |
| publishDate | 2022-06-01 |
| publisher | ITB Journal Publisher |
| record_format | Article |
| series | Journal of Mathematical and Fundamental Sciences |
| spelling | doaj.art-41a3437da4d44914aea2abc736c7d4dc2022-12-22T00:26:34ZengITB Journal PublisherJournal of Mathematical and Fundamental Sciences2337-57602338-55102022-06-0154110.5614/j.math.fund.sci.2022.54.1.5Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with ReworkAtmaram Nigwal0Uttam Kumar Khedlekar1Leena Sharma2Neelesh Gupta3Department of Mathematics Ujjain Engineering Collage, Ujjain M.P. India, Pin Code-451010Department of Mathematics and Statistics Dr. Harisingh Gour Vishwavidyalaya, Sagar M.P., India Pin Code-470003 (A Central University)Department of Mathematics Ujjain Engineering Collage, Ujjain M.P. India, Pin Code-451010Department of Mathematics and Statistics Dr. Harisingh Gour Vishwavidyalaya, Sagar M.P., India Pin Code-470003 (A Central University) In this study, we developed a trade credit policy for a three-layer supply chain consisting of a supplier, a manufacturer and a retailer. We propose an optimal production rate and selling price for the manufacturer and the retailer under an imperfect production system. The suggested coordination policy optimizes the profit of each supply chain member. Two models were formulated for two real-life strategies respectively. The first one is a collaborative (integrated) system and the second one is a Stackelberg leadership system. Both strategies were analyzed for various credit periods, respectively offered by the supplier to the manufacturer, by the manufacturer to the retailer, and by the retailer to the customers, by considering price-sensitive demand and a certain replenishment rate. Finally, we concluded which strategy will be better for inventory management under the given restrictions in the form of propositions. The concavity property for the net profit function was established with respect to the selling price and the production rate, which was also described graphically and analyzed by numerical examples. https://journals.itb.ac.id/index.php/jmfs/article/view/11052holding costimperfect productionnet profitreworksupply chaintrade credit policy |
| spellingShingle | Atmaram Nigwal Uttam Kumar Khedlekar Leena Sharma Neelesh Gupta Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework Journal of Mathematical and Fundamental Sciences holding cost imperfect production net profit rework supply chain trade credit policy |
| title | Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework |
| title_full | Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework |
| title_fullStr | Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework |
| title_full_unstemmed | Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework |
| title_short | Trade Credit Policies for Supplier, Manufacturer, and Retailer: An Imperfect Production-Inventory System with Rework |
| title_sort | trade credit policies for supplier manufacturer and retailer an imperfect production inventory system with rework |
| topic | holding cost imperfect production net profit rework supply chain trade credit policy |
| url | https://journals.itb.ac.id/index.php/jmfs/article/view/11052 |
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