an:06018459
Zbl 1233.90018
Feng, Youyi; Chen, Youhua (Frank)
A computational approach for optimal joint inventory-pricing control in an infinite-horizon periodic-review system
EN
Oper. Res. 59, No. 5, 1297-1303 (2011).
00292587
2011
j
90B05
joint pricing and inventory control; setup cost; price dependent demand; stochastic inventory model
Summary: This note considers a joint inventory-pricing control problem in an infinite-horizon periodic-review system. Demand in a period is random and depends on the posted price. Besides the holding and shortage costs, the system incurs inventory-replenishment costs that consist of both variable and fixed components. At the beginning of each period, a joint inventory and pricing decision is made. Under the long-run average profit criterion, we show that an optimal policy exists within the class of so-called (\(s, S, p\)) policies. This is established based on our algorithmic development, which also results in an algorithm for finding an optimal (\(s, S, p\)) policy.
Reviewer (Berlin)