Stackcelberg game inventory model with progressive permissible delay of payment scheme

Gede Agus Widyadana*, Nita H. Shah, Daniel Suriawidjaja Siek

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

1 Citation (Scopus)

Abstract

Supplier has many schemes to motivate retailer to buy more and of them one is a progressive permissible delay of payment. Instead of analyst from the retailer side alone, in this chapter, we develop the inventory model of supplier and retailer. In reality, some suppliers and retailers cannot have collaboration and they try to optimize their own decision so we develop a Stackelberg Game model. Two models are developed wherein the first model supplier acts as the leader and in the second model, the retailer acts a leader. Since the models are complex, a hybrid Genetic Algorithm (GA) and Particle Swarm Optimization (PSO) is developed to solve the model. A numerical analysis and sensitivity analysis are conducted to get management insights of the model. The results show that a Stackelberg Game model for progressive permissible delay of payment is sensitive in varies values of the first and second delay interest rate if supplier acts as a leader. The retailer gets less inventory cost when he acts as a leader compared to when vendor acts a leader at high interest rate of the first and second delay period.

Original languageEnglish
Title of host publicationHandbook of Research on Promoting Business Process Improvement Through Inventory Control Techniques
PublisherIGI Global
Pages194-214
Number of pages21
ISBN (Electronic)9781522532330
ISBN (Print)1522532323, 9781522532323
DOIs
Publication statusPublished - 22 Dec 2017
Externally publishedYes

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