The consignment stock of inventories: industrial case and performance analysis

Valentini, Giovanni; Zavanella, Lucio

doi:10.1016/s0925-5273(02)00300-6

Cited by 140 publications

(85 citation statements)

References 8 publications

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“…Other related research focused on relaxing the assumed conditions to improve the applicability of the integrated inventory model [20][21][22]. Valentini and Zavanella [23] described the advantages of consignment stock (CS) strategy. Suppliers can not only use the storage space of buyers, but also avoid temporary large quantity orders from buyers.…”

Section: Single-supplier Single-buyermentioning

confidence: 99%

Optimal Retail Price Model for Partial Consignment to Multiple Retailers

Chen

2017

Complexity

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This paper investigates the product pricing decision-making problem under a consignment stock policy in a two-level supply chain composed of one supplier and multiple retailers. The effects of the supplier's wholesale prices and its partial inventory cost absorption of the retail prices of retailers with different market shares are investigated. In the partial product consignment model this paper proposes, the seller and the retailers each absorb part of the inventory costs. This model also provides general solutions for the complete product consignment and the traditional policy that adopts no product consignment. In other words, both the complete consignment and nonconsignment models are extensions of the proposed model (i.e., special cases). Research results indicated that the optimal retail price must be between 1/2 (50%) and 2/3 (66.67%) times the upper limit of the gross profit. This study also explored the results and influence of parameter variations on optimal retail price in the model.

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Section: Single-supplier Single-buyermentioning

confidence: 99%

Optimal Retail Price Model for Partial Consignment to Multiple Retailers

Chen

2017

Complexity

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“…For instance, Pohlen & Goldsby (2003) postulate that significant benefits can be captured by both firms participating in IC arrangements; but that these benefits are typically not well understood by reluctant supplying firms. Supporting this view, reports from industry suggest significant positive benefits from implementing IC programs (Sullivan, 2008;and Valentini & Zavanella 2003). Recently, Xu et al (2016) found that IC programs can reduce the risk of stockouts, thus benefiting the focal firm.…”

Section: Introductionmentioning

confidence: 97%

How inventory consignment programs can improve supply chain performance: a process oriented perspective

Malhotra

Mackelprang

Jayaram

2017

Prod.

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Inventory Consignment (IC) has largely been viewed as a method of shifting the ownership and cost burden of inventory from buyer to supplier to benefit the buyer. This primarily accounting based viewpoint has largely ignored process changes that can occur for both the buyer and supplier. This study addresses this gap in the extant literature by examining IC from a process perspective by specifically addressing: (1) the implementation issues in an IC program for both buyers and suppliers and (2) the financial and operational benefits from IC for both buyers and suppliers. Using the case study methodology, we examined three firms that had varying degrees of involvement and roles in IC programs. Based on our detailed work with these three firms and their supply chain linkages, we offer a series of propositions to demonstrate that IC is not just an accounting issue, but also a management practice that requires a series of process changes in order to be successful. These process changes in turn provide operational benefits for both buyers and suppliers via the mechanism of increased demand visibility to suppliers. Through this approach, this study makes a contribution beyond what has been examined in the prior literature which has mostly dealt with IC as an accounting based inventory management issue.

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“…The basic fundamental of consignment policy is explained in Braglia and Zavanella [1], Valentini and Zavanella [2], Simone and Grubbstrom [3]. Goyal [4] proposed a joint economic lot size model to minimize total costs and is compared with total costs incurred if vendor and buyer act independently.…”

Section: Introductionmentioning

confidence: 99%

“…Banerjee [5] generalized Goyal's [4] model by assuming vendor with finite rate produces for a buyer on a lot-for-lot basis under deterministic conditions. Goyal [6] generalized the Banerjee [2] model by relaxing the assumption of the lot-for-lot policy of the vendor.…”

Section: Introductionmentioning

confidence: 99%