期刊
EUROPEAN JOURNAL OF OPERATIONAL RESEARCH
卷 135, 期 3, 页码 582-601出版社
ELSEVIER SCIENCE BV
DOI: 10.1016/S0377-2217(01)00021-2
关键词
retailing; product substitution; multi-product news-vendor model; service rate heuristic; Lagrangian dual procedure
We analyze the impact of product substitution on two key aspects of retail merchandising: order quantities and expected profits. To perform this analysis. we extend the basic news-vendor model to include the possibility that a product with surplus inventory can be used as a substitute for out of stock products. This extension requires a definition and an approximation for the resulting effective demand under substitution. A service rate heuristic is developed to solve the extended problem. The performance of this heuristic is evaluated using an upper bound generated by solving the associated Lagrangian dual problem. Our analysis suggests that this heuristic provides a tractable and accurate method to determine order quantities and expected profits under substitution. We apply this heuristic to examine how the level of demand uncertainty and correlation, and the degree of substitution between products affect order quantities and expected profits under substitutable demand. In addition, we use the heuristic to better understand the mechanism by which substitution improves expected profits. (C) 2001 Elsevier Science B.V. All rights reserved.
作者
我是这篇论文的作者
点击您的名字以认领此论文并将其添加到您的个人资料中。
推荐
暂无数据