Cost Allocation of Jointly-Managed Inventory Based on Cooperative Game and Data Envelopment Analysis

Integrated supply (I/S) by third-party logistics is an effective way to reduce supply-chain cost. The key problem of I/S is to allocate the joint inventory cost among the suppliers. In this paper, a cost-allocating method is put forward based on cooperative game theory and data envelopment analysis to work out a rational allocation ratio for each supplier. The input-output contributions for each participator are taken into account to ensure more equitable and rational results. Finally, an example is used to testify that this method is exercisable and reasonable.