| In this dissertation, we address strategic and tactical issues in procurement in two parts: a theoretical part based on modeling and analysis and an applied part based on an actual implementation at a grocery retailer. The former analyzes the implications of sequential capacity procurement and constitutes the first two essays of the dissertation. The latter studies active tactical planning in supply chains and constitutes the third essay of the dissertation.; In the first essay, we consider capacity procurement in a stochastic setting with a single supplier and a single manufacturer. The manufacturer procures capacity from her capacitated supplier to satisfy the end-consumer demand. She can procure capacity in the first period without knowing the demand for certain and has the option of procuring more in the second period when more information becomes available. The supplier sets prices in both periods sequentially. He sets the second period price by observing the demand as well as the manufacturer's first period procurement quantity. As an extension, in the second essay we consider capacity procurement in a deterministic setting with a single supplier and two manufacturers. In this setting, the manufacturers strategically interact not only with each other to capture market demand but also with the supplier to influence the capacity pricing decisions.; In these two essays, we characterize how all the parties involved (supplier, manufacturer(s) and end-consumers) are affected. We do so by finding the Subgame Perfect Nash Equilibrium behaviors of the supplier and the manufacturer(s) in closed forms. We obtain several additional insights through numerical experiments.; The third essay focuses on the development of a web-based enterprise-wide tool for tactical planning in a grocery retailer. In this implementation, we improve the retailer's current procurement decisions by enabling a total cost of ownership perspective which coordinates decisions across several functions of the supply chain. Procurement, logistics, and warehouse management decisions are considered, while dynamically optimizing the joint replenishment targets (order frequency, order quantity, and consolidation) in concert with inventory targets. |
