Abstract
In the previous chapters, we analyzed the traditional inventory models, which focus on effective replenishment strategies and typically assume that a commodity’s price is exogenously determined. In recent years, however, a number of industries have used innovative pricing strategies to manage their inventory effectively. For example, techniques such as revenue management have been applied in the airlines, hotels, and rental car agencies—integrating price, inventory control, and quality of service; see Kimes (1989). In the retail industry, to name another example, dynamically pricing commodities can provide significant improvements in profitability, as shown by Gallego and van Ryzin (1994).
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Simchi-Levi, D., Chen, X., Bramel, J. (2014). Integration of Inventory and Pricing. In: The Logic of Logistics. Springer Series in Operations Research and Financial Engineering. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-9149-1_10
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DOI: https://doi.org/10.1007/978-1-4614-9149-1_10
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