GENERAL-MODELS FOR THE SUPPLIERS ALL-UNIT QUANTITY DISCOUNT POLICY

The purpose of this article is to investigate some managerial insights related to using the all-unit quantity discount policies under variou s conditions. The models developed here are general treatments that de al with four major issues: (a) one buyer or multiple buyers, (b) const ant or price-elastic demand, (c) the relationship between the supplier 's production schedule or ordering policy and the buyers' ordering siz es, and (d) the supplier either purchasing or manufacturing the item. The models are developed with two objectives: the supplier's profit im provement or the supplier's increased profit share analysis. Algorithm s are developed to find optimal decision policies. Our analysis provid es the supplier with both the optimal all-unit quantity discount polic y and the optimal production (or ordering) strategy. Numerical example s are provided. (C) 1993 John Wiley & Sons, Inc.