Naval Research Logistics (NRL) > 69 > 3 > 403 - 420
RESEARCH ARTICLE
Combined replenishment and warehousing with contract commitments and flexibilities
Source
Abstract
This paper studies a combined replenishment and warehouse size planning problem. A firm (3PW user) decides the replenishment quantities over a finite planning horizon to satisfy the time‐varying demands of a product. The firm has no warehouse and contracts with a third‐party warehousing (3PW) provider for storage space over the planning horizon. In the warehousing contract, the planning horizon is partitioned into a number of sessions, and each session also consists of multiple periods. The firm decides a stationary base storage size (BSS) of each session and has an opportunity to adjust the BSS at the beginning of each session. The firm also has the option to rent additional storage size beyond the BSS by paying higher rental cost in each individual period. We explore structural properties and develop a strongly polynomial‐time algorithm by applying geometric techniques to solve the firm's replenishment and warehouse sizing problem. We also conduct numerical experiments and provide important insights into the 3PW user's decisions and the 3PW contract design.
Identifiers
journal ISSN : | 0894-069X |
journal e-ISSN : | 1520-6750 |
DOI | 10.1002/nav.22017 |
Authors
Guoqing Wang
- Department of Business Administration, School of Management, Jinan University Guangzhou