Paper Info
Title
A supplier selection and order allocation problem with stochastic demands
Abstract
We consider a system comprising a retailer and a set of candidate suppliers that operates within a finite planning horizon of multiple periods. The retailer replenishes its inventory from the suppliers and satisfies stochastic customer demands. At the beginning of each period, the retailer makes decisions on the replenishment quantity, supplier selection and order allocation among the selected suppliers. An optimisation problem is formulated to minimise the total expected system cost, which includes an outer level stochastic dynamic program for the optimal replenishment quantity and an inner level integer program for supplier selection and order allocation with a given replenishment quantity. For the inner level subproblem, we develop a polynomial algorithm to obtain optimal decisions. For the outer level subproblem, we propose an efficient heuristic for the system with integer-valued inventory, based on the structural properties of the system with real-valued inventory. We investigate the efficiency of the proposed solution approach, as well as the impact of parameters on the optimal replenishment decision with numerical experiments.
Year
DOI
Venue
2011
10.1080/00207721.2010.517864
Int. J. Systems Science
Keywords
Field
DocType
replenishment quantity,total expected system cost,optimal replenishment decision,order allocation,supplier selection,inner level integer program,inner level subproblem,outer level subproblem,order allocation problem,stochastic demand,outer level stochastic,optimal replenishment quantity,satisfiability,stochastic dynamic programming,inventory
Integer,Order allocation,Mathematical optimization,Heuristic,Time horizon,Polynomial algorithm,Mathematics
Journal
Volume
Issue
ISSN
42
8
0020-7721
Citations 
PageRank 
References 
6
0.46
18
Authors
4
Name
Order
Citations
PageRank
Yun Zhou160.46
Lei Zhao2486.51
Xiaobo Zhao311716.07
Jianhua Jiang460.46