Meir J. Rosenblatt

Coordinating a three-level supply chain with quantity discounts

Numerous examples exist that illustrate how companies enjoying a strong position in a supply chain unilaterally dictate terms to their suppliers and/or their customers. This paper suggests a mechanism by which a company can coordinate its purchasing and production functions and create an integrated plan that dictates order and production quantities throughout a three-firm channel. Specifically, we model a company that attempts to dictate channel lot sizes by obtaining a quantity discount from its supplier while offering perhaps a different one to its customer. Previous quantity discount research has examined supply chains consisting of only two levels, a seller and a buyer. This paper considers a three-level chain (supplier-manufacturer-retailer) and explores the benefits of using quantity discounts on both ends of the supply chain to decrease costs. We show that incorporating quantity discounts into both ends of the supply chain can significantly decrease costs compared to concentrating only on the lower end. Furthermore, the results of the decentralized procedure described here are robust vis-a-vis à centralized decision-making procedure.

ESTABLISHING ZONES IN SINGLE-COMMAND CLASS-BASED RECTANGULAR AS/RS

Abstract In this paper, we develop procedures for dividing rectangular warehouses into classes. We describe three types of classes and develop their corresponding traveling time models. A solution procedure involving a one-dimensional (or at most two-dimensional) search is developed. We show that the one-dimensional search procedure is very effective in solving most practical problems. Additionally, we show that most of the savings obtained by a full-turnover policy can be obtained with a relatively few classes—a result similar to the one obtained for the square AS/RS.

On the economic ordering quantity for jointly replenished items

A solution procedure is provided for solving the joint replenishment problem using a basic cycle approach. The solution procedure is very simple, and involves comparing possible values between the ‘minimum’ and ‘maximum’ cycle times. Extensive simulation demonstrates that this solution procedure is superior to previously known algorithms for solving this problem.

A mathematical programming model for global plant location problems: Analysis and insights

In this paper, we study the design of global facility networks. We present a mixed integer programming model that captures essential design trade-offs for such networks and explicitly incorporates government subsidies, trade tariffs and taxation issues. The resulting formulation can be solved for reasonable size problems with commercially available mathematical programming software. Focusing on special cases of the problem enables us to provide useful insights on preferable international facility networks for various environments. We demonstrate the pervasive, and often dominating, effects of subsidized financing, tariffs, regional trade rules and taxation in shaping the manufacturing and distribution network of global firms.

A distance assignment approach to the facility layout problem

The facility layout problem has generally been formulated as a quadratic assignment problem, where the interacting facilities are assigned to the various sites. In this paper a different approach, based on assigning distances between pairs of sites to pairs of facilities, is taken. A network formulation and analysis of this problem is provided. An algorithm, composed of three phases, is developed. The first phase involves preprocessing of the distance matrix. The second phase involves solving the (generalized assignment) network problem. The third phase employs a heuristic procedure which transforms the solution of the second phase into a feasible assignment of facilities to sites. Finally, computational experience with the new algorithm is provided.

THE OPTIMALITY OF THE “CUT ACROSS THE BOARD” RULE APPLIED TO AN INVENTORY MODEL

A common procedure in budget allocation is to let the different entities of an organization determine their optimal budgets. Once the individual requests are received, they are then cut by a common factor, as necessary, so that a global constraint is satisfied. We refer to this procedure as the “cut across the board” rule. In general, this method will not result in a globally optimal solution. In this paper we identify conditions that assure the global optimality of die “cut (or expand) across the board” rule. We specifically focus on a constrained multi-item inventory model and generalize results of Rosenblatt [10] and Plossl and Wight [8]. In addition, we briefly discuss applicability of the results to other areas.