Although the volume discount problem has been studied in the realm of a single supplier and a single buyer, when demand is price sensitive, it is not well understood when a buyer has a group of independent and different buyers. The problem is analyzed as a Stackelberg game whereby the supplier acts as the leader and the buyers act as the followers. Based on the analysis of the buyer' s response to a common volume discount schedule, a nonlinear programming is formulated and a heuristic is developed. It is shown that volume discounts is able to significantly stimulated demand The supplier and the system's profits achieved by volume discounts are higher than quantity discounts, and coordination efficiency of volume discounts is nearly 100%.
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Jadavpur Univ, Dept Math, Kolkata 700032, W Bengal, IndiaJadavpur Univ, Dept Math, Kolkata 700032, W Bengal, India
Sarkar, Sumon
Tiwari, Sunil
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Natl Univ Singapore, Logist Inst Asia Pacific, 21 Heng Mui Keng Terrace, Singapore 119613, SingaporeJadavpur Univ, Dept Math, Kolkata 700032, W Bengal, India
Tiwari, Sunil
Wee, Hui-Ming
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Chung Yuan Christian Univ, Dept Ind & Syst Engn, 200 Chung Pei Rd, Chungli 32023, TaiwanJadavpur Univ, Dept Math, Kolkata 700032, W Bengal, India
Wee, Hui-Ming
Giri, B. C.
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Jadavpur Univ, Dept Math, Kolkata 700032, W Bengal, IndiaJadavpur Univ, Dept Math, Kolkata 700032, W Bengal, India
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Donghua Univ, Glorious Sun Sch Business & Management, Shanghai 200051, Peoples R ChinaDonghua Univ, Glorious Sun Sch Business & Management, Shanghai 200051, Peoples R China
Li, Yingxiao
Zhou, Jianheng
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Donghua Univ, Glorious Sun Sch Business & Management, Shanghai 200051, Peoples R ChinaDonghua Univ, Glorious Sun Sch Business & Management, Shanghai 200051, Peoples R China