Hotel room allocation for sales channel by dynamic programming

This paper describes the sales channels decision problem on balancing opportunity loss and supply surplus. Service industries which sell limited, perishable inventories such as flight tickets and hotel rooms through multi sales channels are constantly faced with the problem how to allocate their inventories for getting the optimum total revenues because a high profitable channel has weak sales power and a low profitable channel has strong one. In order to solve this problem timely and reasonably, this paper formulates an original problem as dynamic programming where the decision factors are induced from the past sales records. Achieving numerical simulation, this paper also shows the availability of the strategy with dynamic programming is shown