Research On Inventory Coordination Of Single-Period Products Based On Entropy

The validity of the inventory control is very important to improve operational efficiency in an enterprise. The single-period products have some characteristics:the short sales period, quickly changes of the demand, and many uncertain factors to the inventory control. So it is very difficult to control the inventory of the single-period products.With the development of the supply chain, coordination is the main method in supply chain management. In a supply chain, the production and sales of the single-period products are implemented by many enterprises, and the inventory coordination is a key factor to successful operations. It is normally that the enterprises have partial demand information about the single-period products due to the short sales period and quickly demand changes of the single-period products. It is one kind of urgent problem for many enterprises to deal with the inventory coordination problem of the single-period products under partial information.The paper studies the inventory coordination of the single-period products under partial demand information. Based on the research on the uncertainty in the inventory control of the single-period products, the information entropy is employed to measure it, and the maximum entropy formulism is applied to forecast the demand distribution under partial information. In order to solve the inventory coordination in the system with more than one enterprise, the paper studies the inventory coordination under partial demand information, and puts forward the inventory coordination schemes based on the idea of decision-making entropy weight. Some problems have been solved in the study:First, the maximum entropy formulism is applied to forecast the demand distribution. The forecast of the demand distribution is the foundation of the inventory control of the single-period products under partial demand information. The maximum entropy formulism is an effective method to discover the demand distribution. Under partial demand information, where only the mean and the variance of the demand are known, the maximum entropy formulism can find out the most probable distribution among all possible distribution. The result of comparing the mothod with Scarf's ordering rule and the assumption of normal distribution shows that it can increase the expect profit of single-period products.Second, a quantity discount scheme based on the entropy weight is established. In a supply chain with a retailer and a supplier, there is a structural limitation under independent decision. By discussing the competition of the retailer and the supplier in the wholesale price, it puts forward a quantity discount scheme based on the entropy weight. Based on the integrated decision, the scheme is an effective method to optimize the whole profit. The scheme is feasible because it considers both the possible profit of the two parties before coordination and the marketing competition of them.Third, it studies the problem of inventory coordination under asymmetric demand information. Usually, the demand information is asymmetric in the supply chain. Being more close to the retail marketing, the retailer has better knowledge of the demand. It studies the two stage decision-making problem under asymmetric demand information, and puts forward the idea of compensated transfer of the decision-making power of the wholesale price from the supplier to the retailer. The profit distribution is also studied by using decision-making entropy weight. The method considers both the marketing competition and the asymmetry of demand information.Fourth, the problem of inventory coordination under the elastic demand is studied. Under the elastic demand, the retail price is a decision variable. By studing the changes of the demand with the retail price under partial demand information, the maximum entropy formulism is applied to deduce the demand distribution at different retail price. After investigating the relationship between the optimal retail price and the optimal wholesale price, the coordination scheme based on the entropy weight is established.Fifth, it studies the inventory coordination method of return policy. When return policy is applied, buyback price is also a decision variable. After discussing the affection of the salvage value and the shortage cost, it studies the affection of return policy to the inventory control, and the decision-making method of return credit based on the entropy weight.The paper is an attempt to apply the information theory to the inventory control. It solves the inventory coordination problem of the single-period products under partial demand information, and also extends the application range of the information theory.