Mohammad Saleh Sohrabi - PHd Student of PNU University
Amir Nasiripoor - Kermanshah AZAD University,

During the past few years, many have been interested in the idea of Vendor Managed Inventory (VMI). Although the idea is considered to be fairly old, there are some new evidences which indicate promising results for the implementation of VMI models. In this paper we evaluate how VMI affects a supply channel. The proposed methodology of this paper divides the study into three parts: VMI-I, VMI-II and VMI-III. The main difference among these is pricing strategy. The model contains two parties along a supply channel: a retailer and a supplier. The proposed model considers demand as a function of price and we analyze the model under different criteria and compare them with traditional models.

Inventory Management, Optimal Pricing, Vender Managed Inventory