Abstract
We study a supply chain scheduling and co-ordination problem comprising multiple suppliers, a single warehouse operator, a single manufacturer, and multiple retailers, where the supply chain has limited production capacity that can take only some of the orders from the retailers. For a decentralised supply chain, the manufacturer is a decision maker that selects the orders and aims to maximise its own profit, where the profit is a function of the order storage time and storage quantity, order sequence-dependent weighted storage costs, and idle time of the orders. On the other hand, for a centralised supply chain, a supply chain co-ordinator exists that aims to maximise the profit of the whole supply chain and allocates the profit among the supply chain members. We first formulate the problem as a two-machine common-due-window flow shop scheduling problem. We then develop a theorem and two algorithms to solve the optimal scheduling problems in both the decentralised and centralised supply chains. With these results, we develop a method that can achieve channel co-ordination based on a profit sharing rule, together with an increase in the production rates and a decrease in the storage costs.
Acknowledgements
We sincerely thank the guest editor Professor H.K. Chan for inviting us to prepare this paper for the special issue. We also thank the co-guest editors and the anonymous reviewers for their constructive comments. This paper was partially supported by the RGC General Research Funding Scheme under grant number of PolyU 5424/11H.