Joint optimal policy ordering/setup in supply chain management with transportation cost

The single-supplier single-buyer problem is considered the basic part of any supply chain. Although transportation cost is a major part of the total operational cost, in most joint supplier-buyer models, the transportation cost is only considered as a part of fixed setup or ordering cost, independent of the size of the shipment. There is a need for models including transportation cost explicitly for better decision-making

Keywords:

supply chain management , cost optimization , joint optimal policy , transportation cost