Mohammad Reza Akbari Jokar - Department of Industrial Engineering, Sharif University of Technology, Tehran, Iran
Mohsen Sheikh Sajadieh

The Coordinated vendor-buyer problem has received a lot of attention in recent years since it is the building block for the wider supply chains. In this paper, we develop an integrated inventory system consisting of a single manufacturer/vendor and single retailer/buyer. Unlike previous works in the literature, the supply lead-time between vendor and buyer is considered to be uniformly distributed. The vendor produces the product in batches and periodically delivers final goods at a fixed lot size to its customer, who has a constant demand rate. The proposed model, based on the integrated expected total costs of both the buyer and the vendor, finds out optimal values of reorder point, order quantity and number of shipments, using a solution procedure. Numerical examples are also employed to show the savings in joint optimization over individually derived policies.

Supply chain coordination, Vendor-buyer coordination, Integrated model