The Distribution Free Newsboy Problem: Review and Extensions

Gallego, Guillermo; Moon, Ilkyeong

doi:10.2307/2583894

Cited by 106 publications

(167 citation statements)

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“…The min‐max approach is used to obtain the most unfavorable p.d.f.

f_{X}

in Ω for each

(T, R, L, α)

and then it is used for minimizing the expected total annual cost function over

(T, R, L, α)

, i.e., our problem is of the form

\begin{matrix} true \\ right {MinMax}_{f_{X} \in normalΩ} E A C (T, R, L, α), \end{matrix}

where

\begin{matrix} true \\ right E A C false(T, R, L, α false) & = & left \frac{A}{T} + θ I (α) + h ([] R - D L - \frac{D T}{2} + α E {(X - R)}^{+}) \\ left + \frac{π_{1} + α π_{0}}{T} E {false(X - R false)}^{+} + \frac{C false(L false)}{T} . \end{matrix}

For this case, we consider the following lemma that was established by Gallego and Moon ().…”

Section: Formulation Of the Modelmentioning

confidence: 99%

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Periodic review fuzzy inventory model with variable lead time and fuzzy demand

Sarkar

Mahapatra

2015

Int Trans Operational Res

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This paper investigates a periodic review fuzzy inventory model with lead time, reorder point, and cycle length as decision variables. The main goal of this study is to minimize the expected total annual cost by simultaneously optimizing cycle length, reorder point, and lead time for the whole system based on fuzzy demand. Two models are considered in this paper: one with normal demand distribution and another with a distribution-free approach. The model assumes a logarithmic investment function for lost-sale rate reduction. Furthermore, two separate efficient computational algorithms are explained to obtain the optimal solution. Some numerical examples are given to illustrate the model.

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“…The min‐max approach is used to obtain the most unfavorable p.d.f.

f_{X}

in Ω for each

(T, R, L, α)

and then it is used for minimizing the expected total annual cost function over

(T, R, L, α)

, i.e., our problem is of the form

\begin{matrix} true \\ right {MinMax}_{f_{X} \in normalΩ} E A C (T, R, L, α), \end{matrix}

where

\begin{matrix} true \\ right E A C false(T, R, L, α false) & = & left \frac{A}{T} + θ I (α) + h ([] R - D L - \frac{D T}{2} + α E {(X - R)}^{+}) \\ left + \frac{π_{1} + α π_{0}}{T} E {false(X - R false)}^{+} + \frac{C false(L false)}{T} . \end{matrix}

For this case, we consider the following lemma that was established by Gallego and Moon ().…”

Section: Formulation Of the Modelmentioning

confidence: 99%

“…The proof in that model was excellent but lengthy and difficult to understand. Gallego and Moon () presented an easy proof of Scarf's () ordering rule. Ben‐Daya and Rauf (), Ouyang and Wu (), Hariga and Ben‐Daya (), Ouyang et al.…”

Section: Introductionmentioning

confidence: 99%

Periodic review fuzzy inventory model with variable lead time and fuzzy demand

Sarkar

Mahapatra

2015

Int Trans Operational Res

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show abstract

“…In this study, we will explore three different types of robust models: the MaxMin, the MinMax Regret (or alternatively MinMax Absolute Regret) and the MaxMin Ratio (or alternatively MaxMin Relative Regret or MaxMin Competitive Ratio). In inventory management, the MaxMin robust approach can be seen for example in Gallego and Moon () and Bertsimas and Thiele (). The paper by Adida and Perakis () is an example of the MaxMin robust approach applied to the dynamic pricing problem.…”

Section: Introductionmentioning

confidence: 99%

Dynamic Pricing through Data Sampling

Cohen

Lobel

Perakis³

2018

Production and Operations Management

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W e study a dynamic pricing problem, where a firm offers a product to be sold over a fixed time horizon. The firm has a given initial inventory level, but there is uncertainty about the demand for the product in each time period. The objective of the firm is to determine a dynamic pricing strategy that maximizes revenue throughout the entire selling season. We develop a tractable optimization model that directly uses demand data, therefore creating a practical decision tool. We show computationally that regret-based objectives can perform well when compared to average revenue maximization and to a Bayesian approach. The modeling approach proposed in this study could be particularly useful for risk-averse managers with limited access to historical data or information about the true demand distribution. Finally, we provide theoretical performance guarantees for this sampling-based solution.

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“…The importance of analyzing these models is reinforced by the growing time-based competition; as time-based competition increases, product life-cycles decrease so that more products will acquire the attributes of fashion or seasonal commodities. Gallego and Moon [26] mentioned that these newsvendor models can reflect many real life situations and is often used to aid decision making in industries such as fashion and sporting goods, both at the manufacturing and retail levels.…”

Section: Introductionmentioning

confidence: 99%

Coordination Scheme for Restructuring Business Operation of the Single Period Newsvendor Problem

Chyu

Huang²

2013

Mathematical Problems in Engineering

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This paper presents a coordination scheme for a single period newsvendor problem when both supplier and retailer of the supply chain agree to change the business operation from a market decision power sharing system (Model 1) to a unique decision maker system (Model 2). The supplier is assumed to be a risk-averse decision maker and he will undertake the product quality risk in both models. Model 1 is game theoretic, where the supplier controls the wholesale price, but the retailer controls the order quantity and market price. The bargaining process ends when the supplier has found a wholesale price that maximizes the value of his sales revenue minus the product quality cost. Model 2 is a centralized system where the supplier possesses all decision powers of the market. In general, Model 2 will generate higher total revenue than Model 1. The aim of this research is to propose a satisfying compromise based on consignment policy to resolve the revenue-sharing conflict in Model 2 due to the additional revenue. An example is provided to illustrate the two models and the proposed coordination scheme, along with managerial insights on the models’ benefits. The impacts of several parameters on the scheme are also presented and discussed.

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The Distribution Free Newsboy Problem: Review and Extensions

Cited by 106 publications

References 0 publications

Periodic review fuzzy inventory model with variable lead time and fuzzy demand

Periodic review fuzzy inventory model with variable lead time and fuzzy demand

Dynamic Pricing through Data Sampling

Coordination Scheme for Restructuring Business Operation of the Single Period Newsvendor Problem

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