Why are Minimum Order Quantity Contracts Popular in Practice? A Behavioral Investigation

2018 ◽  
Author(s):  
Ozge Tuncel ◽  
Sameer Hasija ◽  
Niyazi Taneri
Keyword(s):  
Order Quantity ◽  
Minimum Order ◽  
Minimum Order Quantity

scholarly journals Contracts Adjustment under Bilateral Information Updating in a Supply Chain

Complexity ◽  
2020 ◽  
Vol 2020 ◽  
pp. 1-15
Author(s):  
Xinhui Wang ◽  
Yingsheng Su ◽  
Zihan Zhou ◽  
Yiling Fang
Keyword(s):  
Supply Chain ◽  
Production Cost ◽  
Wholesale Price ◽  
Transfer Payment ◽  
Market Demand ◽  
Order Quantity ◽  
Minimum Order ◽  
Information Updating ◽  
Minimum Order Quantity ◽  
Market Outlook

This paper investigates contracts adjustment between one manufacturer and one retailer under bilateral information updating. The manufacturer incurs uncertain production cost and the retailer faces uncertain demand, but they can acquire independent signals to update production cost and demand, respectively. They commit an initial agreement on an initial wholesale price, minimum order quantity, and information sharing as well as the transfer payment and decisions adjustment when information is updated. We find that due to the joint impact of production cost variation and market variation, the manufacturer may not decrease (increase) her wholesale price when the updated production cost is lower (higher) than expected. The retailer places an additional order even if the wholesale price rises when the market outlook is good, but places an order with the minimum order quantity even if the wholesale price falls when the market outlook is bad. Secondly, for a certain level of information accuracy of the production cost and market demand, the retailer is always better off with information updating, but the manufacturer may be worse off with information updating when facing a bad market outlook. Thirdly, when information accuracy of the production cost and market demand varies, the manufacturer only benefits from a high accuracy of production cost. Profits of the retailer and the supply chain are increasing (decreasing) with accuracy of production cost if the updated production cost is larger (smaller) than expected.

Impacts of Minimum Order Quantity on a Quick Response Supply Chain

2012 ◽  
Vol 42 (4) ◽  
pp. 868-879 ◽  
Author(s):  
Pui-Sze Chow ◽  
Tsan-Ming Choi ◽  
T. C. E. Cheng
Keyword(s):  
Supply Chain ◽  
Quick Response ◽  
Order Quantity ◽  
Minimum Order ◽  
Minimum Order Quantity

Backup sourcing with capacity reservation under uncertain disruption risk and minimum order quantity

2017 ◽  
Vol 103 ◽  
pp. 216-226 ◽  
Author(s):  
Jing Hou ◽  
Amy Z. Zeng ◽  
Li Sun
Keyword(s):  
Order Quantity ◽  
Minimum Order ◽  
Capacity Reservation ◽  
Minimum Order Quantity ◽  
Disruption Risk

The linear dynamic lot size problem with minimum order quantity

2011 ◽  
Vol 133 (2) ◽  
pp. 688-693 ◽  
Author(s):  
Irena Okhrin ◽  
Knut Richter
Keyword(s):  
Order Quantity ◽  
Lot Size ◽  
Minimum Order ◽  
Linear Dynamic ◽  
Size Problem ◽  
Minimum Order Quantity ◽  
Dynamic Lot Size

scholarly journals The Impact of Advance Selling Strategies on a Three-Echelon Supply Chain in the Presence of Social Influence

2020 ◽  
Vol 2020 ◽  
pp. 1-19
Author(s):  
Qianyu Niu ◽  
Feng Yang
Keyword(s):  
Supply Chain ◽  
Social Influence ◽  
Stackelberg Game ◽  
New Product ◽  
Order Quantity ◽  
Minimum Order ◽  
Advance Selling ◽  
Minimum Order Quantity ◽  
Selling Strategies ◽  
The Impact

As the quality of new products is ex-ante uncertain, social influence plays an important role in the diffusion of a new product. An important question is how to expand public knowledge about consumer experience with a new product by using promotion strategies. This paper discusses the impact of advance selling strategies on a three-echelon supply chain when upstream enterprises launch a new product facing strategic consumers under social influence. This problem is modeled as a Stackelberg game, and a two-advance-selling-discount model is presented. Furthermore, we consider the impact of advance purchase behavior on the financing strategy when the retailer places an advance order. Several results are obtained: (i) the consumers’ utility in the second period is increasing in the number of predecessors. (ii) Upstream enterprises will provide deeper advance selling discounts when consumers become more patient or predecessors have a greater influence on imitators. Moreover, the total demand will increase when the consumer’s discount factor decreases or the impact intensity of predecessors increases. However, high innovation levels will drive enterprises to set high advance selling discounts. We also obtain the condition under which the total demand increases quickly as the innovation level changes. (iii) The two-advance-selling-discount model yields Pareto-improved results compared with the case where there is no advance purchase, though it cannot coordinate the supply chain. Finally, we extend the model to analyze the two-advance-selling-discount model with a minimum order quantity constraining the precommitted order quantity, and we show this can allow the enterprises to increase their profits. We also determine a condition under which the upstream enterprises should put a constraint on the minimum order quantity.

Effective inventory control policies with a minimum order quantity and batch ordering

2015 ◽  
Vol 168 ◽  
pp. 21-30 ◽  
Author(s):  
Han Zhu ◽  
Xing Liu ◽  
Youhua (Frank) Chen
Keyword(s):  
Inventory Control ◽  
Order Quantity ◽  
Minimum Order ◽  
Control Policies ◽  
Minimum Order Quantity ◽  
Batch Ordering

A Note on Fixed and Minimum Order Quantity Stock Systems

1974 ◽  
Vol 25 (4) ◽  
pp. 635
Author(s):  
Ralph D. Snyder
Keyword(s):  
Order Quantity ◽  
Minimum Order ◽  
Minimum Order Quantity

scholarly journals DESAIN SISTEM ORDERING SEBAGAI ALAT BANTU PENENTU ANGKA REORDER BERDASARKAN SALES TREND DAN MINIMUM ORDER QUANTITY PADA PERUSAHAAN RETAIL

2013 ◽  
Vol 10 (2) ◽  
pp. 77
Author(s):  
Nursanti Irliana ◽  
Vensy Vydia
Keyword(s):  
Lead Time ◽  
Order Quantity ◽  
Minimum Order ◽  
Safety Stock ◽  
Reorder Point ◽  
Minimum Order Quantity ◽  
Sales Trend

<span>Untuk menghindari hilangnya penjualan dan menjamin safety stock di perusahaan ritel, kita perlu suatu metode untuk menghitung, kapan harus menyusun ulang. Ada beberapa metode untuk menghitung dan memutuskan kapan pengecer harus menyusun ulang dan berapa banyak yang akan dipesan. Salah satu metode tersebut adalah Reorder Point. Reorder adalah titik saat barang harus dipesan. Dan setelah ini pemesanan kembali dihitung, pengecer harus menghitung, berapa banyak unit yang akan dipesan. Dengan perhitungan yang tepat sehingga kedatangan baik akan tepat waktu. Seperti kuantitas minimum order dan lead time. Juga, harus sesuai dengan kondisi internal, seperti jumlah stok terakhir dan tren penjualan dalam periode tertentu.</span><br /><span>Sejalan dengan kondisi ini, penulis akan merancang sebuah sistem untuk proses menyusun ulang, menggunakan metode prototype dan pemrograman Visual FoxPro.</span>

scholarly journals Fixed Order Interval Model for Multi Item Single Supplier Considering Lifetime and Minimum Order Quantity

2019 ◽  
Vol 1179 ◽  
pp. 012022
Author(s):  
Dadang Arifin ◽  
Edhi Yusuf ◽  
Cantri Charisma
Keyword(s):  
Order Interval ◽  
Order Quantity ◽  
Minimum Order ◽  
Interval Model ◽  
Minimum Order Quantity ◽  
Fixed Order
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