Modeling Capacity Reservation and Supplier Selection Based on Option Contract
Publish place: 7th International Industrial Engineering Conference
Publish Year: 1389
نوع سند: مقاله کنفرانسی
زبان: English
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شناسه ملی سند علمی:
IIEC07_151
تاریخ نمایه سازی: 7 خرداد 1389
Abstract:
key issue for manufacturing firms is planning for outsourced components. In this research, we have considered a manufacturer in a Make-to-Order production environment who has to outsource a special component from a set of suppliers. One selling season is considered and the manufacturer faces uncertain demand during the selling season. A good strategy for the manufacturer to balance both holding and lost sale costs is to initiate capacity reservation contracts with his suppliers. Thus, unlike the previous researches we have presented a mathematical model based on option mechanism that will help the manufacturer to select appropriate suppliers and order allocation, simultaneously. The considered option mechanism has a two part contract fee structure (option price and exercise price) and it is at the foundation of practical contracts used by different industries
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Authors
Iman Nosoohi
Department of industrial engineering, Isfahan University of Technology (IUT),
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