A lot sizing order model and solution based on win-win negotiation

Recent years, in the field of supply chain coordination, the collaborative planning mode based on negotiation is getting more and more attention. For solving the problem of order quantity between supplier and demander in collaborative supply chain under the condition of stochastic demand and asymmetric information, this paper established lot sizing order models: Retailer´s model and Manufacturer´s model that are used to calculate their annual profit separately. To get a satisfy solution that both sides accept, a win-win algorithm is proposed. This algorithm applies the equivalents curve theory to the negotiation theory under the condition of time constraints. It is good to simulate the negotiation between sealer and buyer in practice. Also, the win-win algorithm breaks the restriction of Master-slave status in Stackelberg mode and doesn´t need the global information like the centralized decision-making mode. The algorithm proposed in this paper is shown more effective and practical by the analysis of numerical example.