Abstract
In this paper we study an inventory model with backorders where the purchase unit price depends on the ordered quantity. This situation appears in practice when a salesperson offers a fixed compensation to a client for not losing the sale and there are quantity discounts. The optimal policy is obtained through a sequential optimization procedure in two stages that relies on a quadratic function (first stage) and on the objective function of the classical EOQ model (second stage). An algorithm is developed for the model and some extensions are commented.
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San José, L.A., García-Laguna, J. An EOQ model with backorders and all-units discounts. Top 11, 253–274 (2003). https://doi.org/10.1007/BF02579044
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DOI: https://doi.org/10.1007/BF02579044