An Approximation Algorithm for Network Revenue Management Under Nonstationary Arrivals

2020 ◽  
Vol 68 (3) ◽  
pp. 834-855 ◽  
Author(s):  
Yuhang Ma ◽  
Paat Rusmevichientong ◽  
Mika Sumida ◽  
Huseyin Topaloglu
Keyword(s):  
Approximation Algorithm ◽  
Revenue Management ◽  
Capacity Control ◽  
Network Revenue Management ◽  
Pricing Decisions ◽  
Multiple Products ◽  
Performance Guarantees ◽  
Optimal Capacity ◽  
Airline Tickets ◽  
Network Revenue

Many revenue management problems require making capacity control and pricing decisions for multiple products. The decisions for the different products interact because either the products use a common pool of resources or the customers choose and substitute among the products. When pricing airline tickets, for example, different itinerary products use the capacities on common flight legs and the customers choose and substitute among different itinerary products that serve the same origin-destination pair. Finding the optimal capacity control and pricing decisions in such problems can be challenging because one needs to simultaneously consider the capacities available to serve a large pool of products. In “An Approximation Algorithm for Network Revenue Management under Nonstationary Arrivals,” Ma, Rusmevichientong, Sumida, and Topaloglu develop efficient methods to make decisions with performance guarantees in high-dimensional capacity control and pricing problems.

Real-Time Dynamic Pricing for Revenue Management with Reusable Resources, Advance Reservation, and Deterministic Service Time Requirements

2020 ◽  
Vol 68 (3) ◽  
pp. 676-685 ◽  
Author(s):  
Yanzhe (Murray) Lei ◽  
Stefanus Jasin
Keyword(s):  
Revenue Management ◽  
Real Time ◽  
Service Time ◽  
Dynamic Pricing ◽  
Advance Reservation ◽  
Time Dynamic ◽  
Different Types ◽  
Time Requirements ◽  
Deterministic Service ◽  
Resource Capacity

In “Real-Time Dynamic Pricing for Revenue Management with Reusable Resources, Advance Reservation, and Deterministic Service Time Requirements,” Lei and Jasin consider a fundamental dynamic pricing problem when resources are reusable. In this problem, demand arrives according to a price-sensitive nonstationary rate, requesting a service that uses a combination of different types of resources for a deterministic duration of time. The resources are reusable in the sense that they can be immediately used to serve a new customer on the completion of the previous service. Moreover, different customers may have different service time requirement and may book the service in advance. The objective is to construct a dynamic pricing control that maximizes expected total revenues. They develop real-time heuristic controls based on the solution of the deterministic relaxation of the original stochastic problem and show that the proposed controls are near optimal in the regime of large demand and large resource capacity.

scholarly journals Revenue Management in Make-To-Order Manufacturing: Case Study of Capacity Control at ThyssenKrupp VDM

2010 ◽  
Vol 3 (2) ◽  
pp. 173-190 ◽  
Author(s):  
André Hintsches ◽  
Thomas S. Spengler ◽  
Thomas Volling ◽  
Kai Wittek ◽  
Gerald Priegnitz
Keyword(s):  
Revenue Management ◽  
Capacity Control ◽  
Make To Order
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