This paper attempts to model the profitability of a secondary market, in a newsvendor setting, to a profit-maximizing manufacturer, who is offering to the retailer a buyback policy for the unsold merchandise left at the end of the selling season. With a buyback agreement, the manufacturer shares...

This paper analyzes the manufacturers' strategy of optimizing the direct rebate to the final customer and the wholesale price to a profit-maximizing retailer with a price-dependent stochastic demand. The manufacturer possesses full information about the cost and the functional relationship among...

This paper analyses a single-period decision of a retailer facing uncertain and price dependent demand. The typical modeling of the problem in a newsvendor framework assumes the unfulfilled demand to be lost once and for all. However, in reality, there may be an opportunity to backlog the lost...

This paper studies the impact of direct rebates to the end customer from the manufacturer and/or from the retailer upon the profitability and effectiveness of the policies of both channels. Effectiveness is measured by the ratio of the retailer’s to the manufacturer’s profits and by the sum...

This paper evaluates the pricing and ordering policies of a retailer, facing a price-dependent stochastic demand, within a newsvendor framework, under different degrees of risk tolerance and under a variety of optimizing objectives. These are (i) maximizing expected profit, for a retailer who...

Transaction exposure normally arises when there exists a time lag between the time the financial obligation has been incurred and the time it is due to be settled, because the purchase price to the buyer/retailer may, on settlement day, differs from that when it was incurred, if the debt is...

This article considers the effect of freight discounts and disposals on the inventory policies of a profit‐maximising firm with price‐elastic demand and with price as a mark‐up on the acquisition cost. In addition, the cost of placing an order is in part dependent upon a freight‐cost...