Joint economic lot size problem with pipeline inventory cost

Abstract

In this thesis, we study the buyer-vendor problems of supply chain management. In particular, we focus on the joint order quantity model, which can reduce the total cost of both the buyer and the vendor. The Joint order quantity is an order quantity that is optimal between the buyer and the vendor. Banerjee's Joint Economic Lot Size (JELS) model is one of the models we will focus on and then propose an extension. The extension that we add to the model is the pipeluie inventory cost. In the JELS model, the holding cost, which occurs while a product is beuig transported, is not explicitly considered. Therefore, this causes the model to be unrealistic. The pipeline uiventory cost is the holduig cost incurred duruig the delivery period. We add this pipeline inventory cost to the model and caU it the Joint economic lot size with the pipeline inventory cost. In this model, we classify the pipeline inventory into two cases: the buyer is responsible for the pipeline cost or the vendor is responsible for the pipeline cost.