International Journal of Supply Chain Management
Vol 9, No 2 (2020): International Journal of Supply Chain Management (IJSCM)

Integration of Quantity Discount Pricing into Newsvendor Model

Haryadi Sarjono (Binus Business School, Bina Nusantara University Jl. KH Syahdan No. 9, Palmerah, Jakarta Barat 11480, Indonesia)
Jeff Fernandez (Binus Business School, Bina Nusantara University Jl. KH Syahdan No. 9, Palmerah, Jakarta Barat 11480, Indonesia)
Randy Jeremaiah (Binus Business School, Bina Nusantara University Jl. KH Syahdan No. 9, Palmerah, Jakarta Barat 11480, Indonesia)
Randy Tjhie (Binus Business School, Bina Nusantara University Jl. KH Syahdan No. 9, Palmerah, Jakarta Barat 11480, Indonesia)
Bachtiar H Simamora (Binus Business School, Bina Nusantara University Jl. KH Syahdan No. 9, Palmerah, Jakarta Barat 11480, Indonesia)



Article Info

Publish Date
27 Apr 2020

Abstract

This research was done with a purpose to find out the solution of supply shortage problem which often occurs in supplying companies in Indonesia, which resulted by non-optimized order quantity. Quantity Discount Pricing Integrated Newsvendor Model (this term will further be called as Extended Newsvendor) was examined then having its performance compared with subjective method which has already been used by the companies. The comparison was done to discover which method is able to reduce the potential shortage of supplies, total cost of each unit, age of inventory, and order frequency. Extended Newsvendor method was chosen to be examined in the first place due to its assumption which was deemed suitable with the actual condition that is encountered by the companies, where the demand happens stochastically, and quantity discount pricing policy is applied. The calculation that utilizes 5 years of the company historical data, this research find that the Extended Newsvendor method is generally able to improve the performance of the order quantity medium-sized companies but is unable to improve the performance of the order quantity of small-sized companies

Copyrights © 2020






Journal Info

Abbrev

IJSCM

Publisher

Subject

Decision Sciences, Operations Research & Management Engineering Environmental Science Industrial & Manufacturing Engineering Transportation

Description

International Journal of Supply Chain Management (IJSCM) is a peer-reviewed indexed journal, ISSN: 2050-7399 (Online), 2051-3771 (Print), that publishes original, high quality, supply chain management empirical research that will have a significant impact on SCM theory and practice. Manuscripts ...