The total yearly costs of medicine usage in The Netherlands are increasing year after year. The Dutch government tries to get this increase under control by price regulations, which forces pharmaceutical manufacturers in The Netherlands to manufacture and distribute more efficiently. In this...

In this paper we analyse the effect of satisfying in a different way customers with an order larger than a prespecified cutoff transaction size, in a simple newsboy setting.For compound Poisson demand with discrete order sizes, we show how to determine the expected costs and the optimal cutoff...