The profit-maximization model for a multi-item distribution channel

Jen Ming Chen, Tsung Hui Chen

Research output: Contribution to journalArticlepeer-review

40 Scopus citations

Abstract

This study focused on an area of emerging research: managing a multi-product and multi-echelon supply chain which produces and sells deteriorating goods in the marketplace. We formulated four profit-maximization models by considering the effects of channel coordination and a joint replenishment program on the supply-side cost control, taking into account the effect of the pricing scheme on demand and revenue increments. In addition, a profit-sharing mechanism based on channel rebates is proposed, which leads to Pareto improvements among the channel participants.

Original languageEnglish
Pages (from-to)338-354
Number of pages17
JournalTransportation Research Part E: Logistics and Transportation Review
Volume43
Issue number4
DOIs
StatePublished - Jul 2007

Keywords

  • Channel coordination
  • Inventory
  • Joint replenishment
  • Pricing

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