Analysing the effect of realized demand under bidirectional option contracts in supply chains | |
| Author | Mudannayake, Modhika Isuru Bandara |
| Subject(s) | Business logistics Business logistics--Contracting out |
| Note | A thesis submitted in partial fulfillment of the requirements for the degree of Master of Engineering in Industrial Engineering and Manufacturing, School of Engineering and Technology |
| Publisher | Asian Institute of Technology |
| Abstract | This research studies a bidirectional supply chain contract between a manufacturer and a retailer in which the selling period is relatively shorter compared to the long production lead time. At the beginning of the planning horizon, based on the demand forecast available, the retailer makes an initial order and purchase options. Next at the beginning of the selling season, based on the realized demand forecast, the retailer exercises the options as call or put. A mathematical model is developed to analyse the effect of realized demand. Expected profit functions are developed for all parties in the supply chain. This research has confirmed that this supply chain contract can coordinate the supply chain. Furthermore it confirms that the variance of the realized demand affects the expected profits. Hence the retailer should put more effort in making the realized demand forecast accurate so that better expected profits can be achieved. |
| Year | 2015 |
| Type | Thesis |
| School | School of Engineering and Technology (SET) |
| Department | Department of Industrial Systems Engineering (DISE) |
| Academic Program/FoS | Industrial Systems Engineering (ISE) |
| Chairperson(s) | Huynh Trung Luong; |
| Examination Committee(s) | Voratas Kachitvichyanukul;Bohez, Erik L.J.; |
| Scholarship Donor(s) | AIT Fellowship; |