Supplier selection problem for a single manufacturing unit under stochastic demand

In this paper we consider a supplier selection problem for a single manufacturer/retailer who faces a random demand. All the available suppliers may quote different prices and may have restrictions on minimum and maximum order sizes. The objective is to find a low-cost assortment of suppliers which is capable of satisfying the demand. Properties of the problem are explored and a solution algorithm is proposed. Numerical experimentation is presented for evaluating the performance of the algorithm.