Pricing and Lot-sizing Policies in Multi-Level Supply Chain with Rework Process

In this research, a production-inventory model in a multi-level supply chain involving a supplier, a manufacturer, a distributor and several noncompeting retailers with rework process is studied where a supplier supplies raw material and the manufacturer transforms them to the finished products and ships to the distributor. The distributor distributes finished products to the retailers to satisfy market demand. In this chain, a Stackelberg approach is considered between the members. The aim of the paper is to obtain the optimal values of ordering quantity of supplier and the manufacturer, and the distributor and the retailers' selling prices. Finally, the numerical example is presented for the proposed model.

Keywords:

Pricing , Inventory , Stackelberg approach , Supply Chain , Rework Process