A Joint Decision Model of Pricing and Inventory Control for a Distribution System in Apparel Industry

This paper mainly introduces a distribution system, including one garment manufacturer and one retail store with the products entering into market by batch-wise in apparel industry. Under stochastic demand with price-elasticity, this paper studies price adjustment for twice. Then it gives the profit function of manufacturer and retail store separately, on the basis of this, constructs pricing and inventory profit-optimal decision model. In order to get an appropriate solution for distribution system member, the model is solved by numerical method under the condition that vendor is the leader in a Stackelberg game. Finally, we calculate with the actual date to study the value of the strategy and achieve the desired results.