Using simulation optimization as a decision support tool for supply chain coordination with contracts

Hamidreza Eskandari, Mohamad Darayi, Christopher D. Geiger

Research output: Chapter in Book/Report/Conference proceedingConference contribution

5 Scopus citations

Abstract

This paper studies the issue of channel coordination for a supply chain consisting of one supplier and two retailers, facing stochastic demand that is sensitive to both sales effort and retail price. We develop a decision support tool using simulation optimization for supply chain coordination with revenue sharing or buyback contract. In order to represent a real competitive price and effort dependent demand, a new linear demand model is proposed. Due to the stochastic nature of the market demand and the interaction between decision variables, simulation could help us modeling and analyzing the problem. Simulation optimization is then used to find the optimum or near optimum set of decision variables in the cases of centralized supply chain and coordinated supply chain with contracts.

Original languageEnglish (US)
Title of host publicationProceedings of the 2010 Winter Simulation Conference, WSC'10
Pages1306-1317
Number of pages12
DOIs
Publication statusPublished - Dec 1 2010
Event2010 43rd Winter Simulation Conference, WSC'10 - Baltimore, MD, United States
Duration: Dec 5 2010Dec 8 2010

Publication series

NameProceedings - Winter Simulation Conference
ISSN (Print)0891-7736

Other

Other2010 43rd Winter Simulation Conference, WSC'10
CountryUnited States
CityBaltimore, MD
Period12/5/1012/8/10

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All Science Journal Classification (ASJC) codes

  • Software
  • Modeling and Simulation
  • Computer Science Applications

Cite this

Eskandari, H., Darayi, M., & Geiger, C. D. (2010). Using simulation optimization as a decision support tool for supply chain coordination with contracts. In Proceedings of the 2010 Winter Simulation Conference, WSC'10 (pp. 1306-1317). [5679062] (Proceedings - Winter Simulation Conference). https://doi.org/10.1109/WSC.2010.5679062