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The effect of supplier¡¦s expected cost by using the sharing sales information in VMI.

Vendor managed inventory (VMI) is a form of automated replenishment under which a supplier takes responsibility for managing a customer¡¦s inventory levels for a given product or material. The promise of VMI was more efficient inventory management with less out-of-stock, improved sales and improved consumer satisfaction. Based on the sharing sales information, VMI makes suppliers reduce inventory and cost. Therefore, VMI is one of the most widely discussed initiatives for improving multi-firm supply chain efficiency.
The purpose of this paper is to discuss the effect of supplier¡¦s expected cost by using the sharing sales information .We assume the underlying demand process faced by the retailer is ARMA(1,2). We model the supplier¡¦s delivery variance, optimal delivery-up-to level, and expected cost under three different levels of information sharing, namely no information sharing, partial information sharing, and total information sharing.
Furthermore, we study the sensitivity analysis of supplier¡¦s delivery variance, optimal delivery-up-to level, and expected cost for the following four factors: lead-time l, correlation coefficient , tow-weights in ARMA(1,2), and , followed by numerical examples to verify our findings. The main results are as follows.
1¡B Information sharing stabilizes the supplier¡¦s delivery and reduces supplier¡¦s optimal delivery-up-to level as well as expected cost.
2¡B In each level of information sharing, there is positive effect to the supplier¡¦s delivery variance, optimal delivery-up-to level, and expected cost for every factor.
3¡B All the factors multiply the cost reduction effect contributed by increasing the level of information sharing. Among all, the lead time l and cause the most significant effect.

Identiferoai:union.ndltd.org:NSYSU/oai:NSYSU:etd-0819103-170950
Date19 August 2003
CreatorsChen, Chiu-Miao
ContributorsHueimei Liang, none, Jen-Jsung Huang, Chin,Chang-Chiang
PublisherNSYSU
Source SetsNSYSU Electronic Thesis and Dissertation Archive
LanguageCholon
Detected LanguageEnglish
Typetext
Formatapplication/pdf
Sourcehttp://etd.lib.nsysu.edu.tw/ETD-db/ETD-search/view_etd?URN=etd-0819103-170950
Rightsnot_available, Copyright information available at source archive

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