Based On The Spillover Effects Of The Eoq Inventory Control Model

Since the later years of 20th century, enterprisers begin to recognize that Supply Chain Management is an important way to increase performance of enterprise. SCM also became a focus in the academic environment. Interaction for example bullwhip effect between different enterprisers which form the supply chain is a very important problem in supply chain management, and it has also been drawn more attention by science and enterprises fields.The Interaction of supply chain which this paper puts on research is mainly based on EOQ inventory control model to combine the concentrated decision making and decentralized decision making. It also discusses the two nodes and three nodes interaction problems in supply chain from the angle of cost. Following works have been done:I. Inventory model including one supplier and one retailer is proposed. Response strategy and inventory strategy are analyzed when concentrated decision making or decentralized decision making is adopted respectively. Then, the cost vibration of enterprisers, resulted from fluctuation of lead time, is compared based on absolute value of the cost relative variable. The relation between the cost vibrations of enterprisers is obtained on the conditions of fixed decision making using Mathematica and Excel software. The cost vibration of enterprisers is magnifying effect from upper nodes to lower nodes and the upper corporation benefits from fluctuation of lead time. In additionally, the relation between the cost vibrations of enterprisers is analyzed on the conditions of different decision making and preference for the decision makings is obtained.II. Inventory model including one supplier, one wholesaler and one retailer is proposed. Response strategy and inventory strategy are analyzed when concentrated decision making or decentralized decision making is adopted respectively. Then, the cost vibration of enterprisers and the fluctuation of lead time, resulted from fluctuation of lead time, are compared based on absolute value of the cost or lead time relative variable. The relation between the cost vibrations and lead time fluctuation of different enterprisers is obtained on the conditions of fixed decision making using Mathematica and Excel software. The cost vibration of enterprisers and the fluctuation of lead time are magnifying effect from upper nodes to lower nodes and the upper corporation benefits from fluctuation of lead time. In additionally, the relation between the cost vibrations of enterprisers is analyzed on the conditions of different decision making and preference for the decision makings of different enterprisers is obtained.Different from other inventory model including three nodes, the innovation in this paper is that inventory model including three nodes is constructed by means of cost transfer. The cost vibration of enterprisers and the fluctuation of lead time are compared, then, the reply strategy of different enterprisers is proposed, which is also the new feature of this paper.