A multi-period ordering policy in supply chain

Supply chain management (SCM) is seen as a set of practices aimed at managing and coordinating the whole supply chain from raw material suppliers to end customers and develops greater synergy through collaboration along the whole channel. Traditionally, a newsboy model can be employed in a single period and single product ordering model of a retailer. In this paper, we extend the classical newsboy model to solve a multiple period ordering policy between a manufacturer and a retailer. We consider a single product which is subject to uncertain demand which is a function of price. The proposed model can determine the quantity of the retailer ordering from the manufacturer by considering maximizing the profit of the channel. A numerical study is conducted to attend qualitative insights into the structures of the proposed policy. The numerical results show that the solutions generated by the proposed policy outperform that by the independent policy or fix ordering quantity policy in the profits of the retailer and overall channel.