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| Author: | Gjerdrum, J. Shah, N. Papageorgiou, L. G. |
| Title: | Fair transfer price and inventory holding policies in two- enterprise supply chains |
| Journal: | European Journal of Operational Research
2002 : DEC, VOL. 143:3, p. 582-599 |
| Index terms: | SUPPLY CHAIN MANAGEMENT TRANSFER PRICING OPTIMIZATION GAME THEORY |
| Language: | eng |
| Abstract: | A key issue in supply chain optimisation involving multiple enterprises is the determination of policies that optimise' the performance of the supply chain as a whole while ensuring adequate rewards for each participant. In this paper, the authors present a mathematical programming formulation for fair, optimised profit distribution between echelons in a general multi- enterprise supply chain. The proposed formulation is based on an approach applying the Nash bargaining solution for finding optimal multi-partner profit levels subject to given minimum echelon profit requirements. The overall problem is first formulated as a mixed integer non-linear programming (MINLP) model. |
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