Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/13353
Title: Impacts of minimum order quantity on a quick response supply chain
Authors: Chow, PS
Choi, TM 
Cheng, TCE
Keywords: Coordination
minimum order quantity (MOQ)
quick response (QR)
Issue Date: 2012
Publisher: Institute of Electrical and Electronics Engineers
Source: IEEE transactions on systems, man, and cybernetics. Part A, Systems and humans, 2012, v. 42, no. 4, 6155096, p. 868-879 How to cite?
Journal: IEEE transactions on systems, man, and cybernetics. Part A, Systems and humans 
Abstract: In this paper, we study the impacts of imposing a minimum order quantity (MOQ) on a two-echelon supply chain implementing quick response (QR) and consider the issue of coordination for such a system. By exploring the QR-MOQ supply chain system, we analytically prove that the retailer's expected profit (REP) is nonincreasing in the MOQ. We further find that the MOQ that maximizes the manufacturer's expected profit can significantly reduce the REP and the supply chain's efficiency. Understanding that the static nature of the preagreed MOQ hinders the information updating capability brought about by QR, which, in turn, decreases the supply chain's efficiency, we propose an innovative dynamic MOQ policy and derive the analytical conditions under which channel coordination with Pareto improvement is achieved.
URI: http://hdl.handle.net/10397/13353
ISSN: 1083-4427
EISSN: 1083-4419
DOI: 10.1109/TSMCA.2012.2183351
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