A delayed payment method in co-ordinating a single-vendor multi-buyer supply chain

Chi Kin Chan, Y. C.E. Lee, S. K. Goyal

Research output: Journal article publicationJournal articleAcademic researchpeer-review

43 Citations (Scopus)

Abstract

In this paper, we consider a co-ordinated single-vendor multi-buyer supply chain model by synchronizing ordering and production cycles with delayed payments that are based on the buyers' order intervals. It can be shown that the synchronized cycles policy works better, in terms of total system costs, than independent optimization. While the vendor is benefited from the co-ordination by synchronized cycles, this research proposes a co-ordination mechanism that incorporates a delayed payment method which can guarantee that a buyer's total relevant cost of co-ordination will not be increased when compared with independent optimization. Most importantly, the vendor does not require any cost information from the buyers when applying this co-ordination mechanism.
Original languageEnglish
Pages (from-to)95-102
Number of pages8
JournalInternational Journal of Production Economics
Volume127
Issue number1
DOIs
Publication statusPublished - 1 Sep 2010

Keywords

  • Cost sharing
  • Delayed payment
  • Multiple buyers
  • Synchronization

ASJC Scopus subject areas

  • Business, Management and Accounting(all)
  • Economics and Econometrics
  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering

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