Tamsui, Taipei : Tamkang University, Department of Management Sciences and Decision Making
In most inventory models, vendorlbuyer optimality has been discussed independently. However, this type of one-sided optimality is not suitable in today's global markets. In addition, as a result of poor quality materials, carelessness of workers, poor performance of machines, and perhaps in combination with imperfect production processes, an arrival lot often contains defective items. Consequently, this paper investigates vendor-buyer inventory policy for flawed items in a buyer's arrival order lot with backlogging. First, we derive inventory models based upon non-cooperative and cooperative strategy in which the order quantity, backorder quantity and the number of shipments from vendor to buyer are decision variables. Second, algorithms are developed to obtain the optimal production and inventory policy. Finally, several numerical examples are given to illustrate the theoretical results.
Proceedings of the 2008 International Conference in Management Sciences and Decision Making= 2008年管理科學與經營決策國際學術研討會論文集, pp155-170